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Note 7: Non-Financial Assets

Note 7A: Reconciliation of the Opening and Closing Balances of Property, Plant and Equipment and Intangibles


Plant &







As at 1 July 2019

Gross book value





Accumulated depreciation/amortisation and impairment





Total as at 1 July 2019





Recognition of right of use asset on initial application of AASB 16





Adjusted total as at 1 July 2019











Right-of-use assets





Lease Incentive





Depreciation and amortisation





Depreciation on right-of-use assets










Total as at 30 June 2020





Total as at 30 June 2020 represented by

Gross book value





Accumulated depreciation/amortisation and impairment





Total as at 30 June 2020





Carrying amount of right-of-use assets





No indicators of impairment were found for property, plant and equipment and intangibles. Intangibles includes both purchased software and internally generated software.

No significant property, plant and equipment and intangibles are expected to be sold or disposed of within the next 12 months.

Revaluations of non-financial assets

All revaluations were conducted in accordance with the revaluation policy. CDPP engaged the services of an independent valuer to conduct the revaluations as at 30 June 2018. No revaluation was performed for 2019-20. Management has determined that the carrying value is not materially different to the fair value for property and plant and equipment asset classes.

Contractual commitments for the acquisition of property, plant and equipment and intangible assets

As at 30 June 2020 there were capital commitments of $2,129,610 (GST exclusive): $1,179,124 for property (2019: nil); $763,333 for plant and equipment (2019: nil); and $187,153 for intangibles (2019: $45,149). The CDPP are expecting a lease incentive payment of $1,454,112 in relation to a property capital commitment and capital work completed in 2019-20.

Accounting Policy

Recognition and Depreciation

Assets are recognised initially at cost on acquisition in accordance with the table below.

Depreciable property, plant and equipment assets are written-off to their estimated residual values over their estimated useful lives to the CDPP using, in all cases, the straight-line method of depreciation. Intangible assets are amortised on a straight-line basis.

Depreciation rates applying to each class of depreciable asset are based on the following useful lives:

Useful Life





lease term

20,000 or 5% of total value

Plant and equipment

3-30 years



3-6 years


The depreciation rates for ROU assets are based on the commencement date to the earlier of the end of the useful life of the ROU asset or the end of the lease term.

Lease Right of Use (ROU) Assets

Leased ROU assets are capitalised at the commencement date of the lease and comprise of the initial lease liability amount, estimated restoration costs and initial direct costs incurred when entering into the lease, less any lease incentives received. These assets are accounted for as separate asset classes to corresponding assets owned outright, but included in the same column as where the corresponding underlying assets would be presented if they were owned.

Following initial application, an impairment review is undertaken for any ROU lease asset that shows indicators of impairment and an impairment loss is recognised against any ROU lease asset that is impaired.


Fair values for each class of asset are determined as shown below:

Asset class

Fair value measured at


Depreciated replacement cost

Plant and equipment

Market selling price and depreciated replacement cost

Following initial recognition at cost, property, plant and equipment (excluding ROU assets) are carried at fair value less subsequent accumulated depreciation and accumulated impairment losses. Valuations are conducted with sufficient frequency to ensure that the carrying amounts of assets do not differ materially from the assets’ fair values as at the reporting date. The regularity of independent valuations depends upon the volatility of movements in market values for the relevant assets. The most recent independent valuation was conducted on 30 June 2018. Impairment assessment is carried out on an annual basis.

Assets are revalued in accordance with AASB 116 Property, Plant and Equipment approximately every five years unless the annual fair value assessment suggests that there is a material difference between carrying value of assets and their fair value. Where there is a material difference, all assets in that category are revalued.

Revaluation adjustments are made on a class basis. Any revaluation increment is credited to equity under the heading of asset revaluation reserve except to the extent that it reversed a previous revaluation decrement of the same asset class that was previously recognised in the surplus/deficit. Revaluation decrements for a class of assets are recognised directly in the surplus/deficit except to the extent that they reversed a previous revaluation increment for that class.

Any accumulated depreciation as at the revaluation date is eliminated against the gross carrying amount of the asset and the asset restated to the revalued amount.


All assets are assessed annually for impairment. Where indications of impairment exist, the asset’s recoverable amount is estimated and an impairment adjustment made if the asset’s recoverable amount is less than its carrying amount.


An item of property, plant and equipment is derecognised upon disposal or when no further future economic benefits are expected from its use or disposal.


CDPP's intangibles includes purchased software and internally generated software for internal use. These assets are carried at cost less accumulated amortisation and accumulated impairment losses.

Software is amortised on a straight-line basis over its anticipated useful life. The useful lives of the CDPP's software are 3 to 6 years (2019: 3 to 6 years).

All software assets were assessed for indications of impairment as at 30 June 2020.

Accounting Judgements and Estimates

Fair value measurement

An annual assessment is undertaken to determine whether the carrying amount of assets differs materially from the fair value. Comprehensive valuations are undertaken at least once every five years. The fair value of property, plant and equipment is determined using either the Market Approach or the Cost Approach.

Market Approach

The Market Approach seeks to estimate the current value of an asset in its highest and best use with reference to recent market evidence including transactions of comparable assets. Certain items of land, buildings, leasehold improvements, plant and equipment are valued using the Market Approach. Inputs utilised under the Market Approach comprise market transactions of comparable assets adjusted to reflect differences in price sensitive characteristics including:

  • recent market sales of comparable land and buildings adjusted for size and location; and
  • current prices for comparable or substitute items of property, plant and equipment available within local second-hand markets or adjusted for location.

Cost Approach

The Cost Approach seeks to estimate the amount required to replace the service capacity of an asset in its highest and best use. In cases where sufficient observable market evidence is unavailable, the Cost Approach is applied and determined as the Depreciated Replacement Cost (DRC).

Certain items of land, buildings, leasehold improvements, plant and equipment are valued using DRC. Under DRC the replacement costs of new assets are adjusted for physical depreciation and obsolescence such as physical deterioration, functional or technical obsolescence and conditions of the economic environment specific to the asset. This is determined based on the estimated physical, economic and external obsolescence factors relevant to the asset under consideration.