Notes - 4.2 Administered – Non-Financial Assets
4.2 Administered – Non-Financial Assets
Note 4.2A: Reconciliation of the Opening and Closing Balances of Property, Plant and Equipment for 2020 | ||||||
Reconciliation of the opening and closing balances of property, plant, equipment and intangibles for 2020 | ||||||
Land1 | Buildings | Property, plant and equipment | Heritage and cultural assets2 | Intangible assets3 | Total | |
$’000 | $’000 | $’000 | $’000 | $’000 | $’000 | |
As at 1 July 2019 | ||||||
Gross book value | 429,392 | 16,410 | 351,193 | 48,089 | 3,099 | 848,183 |
Accumulated depreciation and impairment | - | (132) | (3,631) | (144) | (285) | (4,192) |
Total as at 1 July 2019 | 429,392 | 16,278 | 347,562 | 47,945 | 2,814 | 843,991 |
Adjustments to opening balance - gross value4 | - | 34 | 126 | 123 | 4 | 287 |
Adjusted total as at 1 July 2019 | 429,392 | 16,312 | 347,688 | 48,068 | 2,818 | 844,278 |
Additions: | ||||||
Work In Progress movements | 342 | 2,004 | 5,228 | 616 | (1,509) | 6,681 |
Transfer from Work In Progress | 473 | 423 | 8,038 | 18 | 2,305 | 11,257 |
Other additions | 4,900 | - | - | - | - | 4,900 |
Revaluations recognised in other comprehensive income5 | 38,240 | 2,110 | 82,189 | 6,633 | - | 129,172 |
Disposals | (4,900) | - | - | - | - | (4,900) |
Impairments | - | (87) | (124) | - | - | (211) |
Depreciation and amortisation | - | (693) | (21,692) | (965) | (48) | (23,398) |
Other movements | - | - | (178) | - | - | (178) |
Reclassifications - Gross Value | - | (16) | (10) | 16 | - | (10) |
Reclassification - Accumulated Depreciation | - | 16 | 10 | (16) | - | 10 |
Total as at 30 June 2020 | 468,447 | 20,069 | 421,149 | 54,370 | 3,566 | 967,601 |
Total as at 30 June 2020 represented by: | ||||||
Gross book value | 468,447 | 20,069 | 421,149 | 54,370 | 3,899 | 967,934 |
Accumulated depreciation and amortisation | - | - | - | - | (333) | (333) |
Total as at 30 June 2020 | 468,447 | 20,069 | 421,149 | 54,370 | 3,566 | 967,601 |
- Land Exchange with the ACT Government. On 23 March 2020 the NCA exchanged 2.86ha of Commonwealth lake bed land at West Basin, ACT, for 31.6ha of land in Curtin, ACT, for future establishment of a Diplomatic Estate. The NCA does not recognise the financial value of land under lakes until it becomes apparent that future economic benefits will arise. The 2.86ha of lake bed was recognised prior to the exchange via the Asset Revaluation Reserve. As part of the exchange transaction, it was disposed of and the 31.6ha in Curtin was acquired in March 2020. The value of the two assets was considered equal ($4.9 million, being the value of the Curtin land as valued by an independent valuer).
- Land, buildings and other property, plant and equipment that met the definition of a heritage and cultural item were disclosed in the heritage and cultural asset class.
- The carrying amount of intangibles is all purchased software.
- Opening balance adjustments related to previous year understatement of Work In Progress.
- A comprehensive revaluation of assets was completed as at 30 June 2020. The value of land has increased due to the change in valuation methodology for Trees (refer Accounting Estimate note), now valued at approximately $50 million, an increase of $32 million, and the inclusion of 31.6ha of land in Curtin ACT, (refer Note 1. above). The value of Property, Plant and Equipment has increased due to more granular valuation (more detailed information was available for the valuer due to the implementation of the NCA’s new Asset Management System) and the valuation of assets not previously valued (for example, recent major works). The largest movements were in the valuation of Scrivener Dam, lighting and signals, carparks and roads.
Property, plant and equipment, heritage and cultural, and intangible assets were tested for impairment at 30 June 2020. Assets found to be impaired were written down in accordance with the stated policy stated at Note 3.2.
No property, plant and equipment, heritage and cultural, or intangible assets are expected to be sold or disposed of within the next 12 months.
Revaluations of non-financial assets
All revaluations were conducted by an independent valuer in accordance with the revaluation policy stated at Note 7.4.
Contractual commitments for the acquisition of property, plant and equipment and intangible assets | |||
2020 | 2019 | ||
$'000 | $'000 | ||
Buildings | 17 | 588 | |
Infrastructure, plant and equipment | 17,311 | 7,109 | |
Heritage assets | - | 51 | |
Intangibles | - | 270 | |
Total Commitments | 17,328 | 8,018 | |
In 2019-20, significant commitments relate to Scrivener Dam, Lake Burley Griffin walls restoration and replacement of parking machines.
In 2018-19, significant commitments related to the replacement of street furniture, works on the Captain Cook Memorial Jet and Scrivener Dam, upgrades to the Carillon and other event venues.
Accounting Policy The accounting policy for non-financial assets disclosed in Note 3.2 applies equally to administered non-financial assets. |
Change in Accounting Estimate - Valuation of Trees The NCA has some 19,000 trees, of various species, in its Asset Register. In 2019-20, the NCA changed its accounting estimate of the valuation of trees. Previously, trees were recorded within the NCA Asset Register utilising as an underlying value assessment the “Thyer Method”. The “Thyer Method” establishes a value for a tree based firstly upon its likely cost, with the value of that tree then determined by a multiplier calculated by a number of factors such as age, height, area of canopy and a number of subjective ratings including social benefit, form and features, together with social significance. By providing a numeric rating to the various inputs, a multiplier is determined which is then applied to the assumed replacement cost of the tree at the date of valuation. When the trees were originally valued on this basis and consolidated, reasonably significant values were established which were then in turn discounted prior to adoption to reflect the sheer number of trees, as the aggregate of the individual tree values on the “Thyer Method” was considered an unrealistic assessment and an assessment that could not be supported by any market evidence. At the time, the use of the “Thyer Method”, albeit on a significantly discounted basis once overall values were established, provided a reasonable representation or value contribution for the trees which was considered suitable for adoption. From 2019-20, the NCA has adopted the cost approach utilising the additional detailed information available in the new Asset Management System. In the revised cost approach, the total cost of the trees has been established by firstly considering the cost to remove the existing trees, the cost of the tree itself (by genus), delivery and costs associated with maintaining the tree to self-sufficiency. Trees that can be defined as mature or over mature are depreciated, however for all other trees their Fair Value is the stated Replacement Cost. This change in accounting estimate has resulted in a movement in Fair Value from 30 June 2019 to 30 June 2020 of approximately $32 million. |
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