Annual Report 2014

NOOSA SHIRE COUNCIL

 Notes to the financial statements
 For ihe six months ending 30 June 2014
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    19   Fair value measurements - continued

               1(b) Reads, Stormwater and Bridge network — Sensitivity of valuation to unobservable inputs
                    As detailed above Council's roads, drainage and bridge network has been valued using written down current replacement cost. This method utilises a
                    number of inputs that require judgement and are therefore classed as unobservable, While these judgements are made with the greatest care, and based
                    upon years of experience, different judgements could result in a different valuation. The table below summarises the effect that changes in the most
                    significant unobservable inputs would have on the valuation:

            Significant unobservable input]     2°:           Range of inputs                  Relationship of unobservable inputs te
             be          EEE                  [is                    :                          :           fairvalie
         Number of Labour hours               5-]00hrs/linear metre or sqm                    The higher the labour hours, the higher the
                                                                                              fair value
          Standard material usage quantities | Varies depending upon the type of material     The higher the usage quantities, the higher
                                                                                              the fair value
          Remaining useful life               10-120 years                                    ‘The longer the remaining useful life. the
                                                                                              higher the fair vatue.

          2(a) Stormwater and Other Infrastructure — Calculation of written down current replacement cost
                     The fair value of other infrastructure was determined by reference to the non-residential cost of construction index rates effective 1 January 2014.
                     Where there isa market for Council's other infrastructure assets, fair value has been derived from the sales prices of comparable asscts.

                     Accumulated depreciation:
                     In determining the level of accumulated depreciation the asset has been disaggregated into significant components which exhibit useful lives.
                     Allowance has been made for the typical asset life cycle and renewal treatments of each component, residual value at the time the asset is considered to
                     be no longer available for use and the condition of the asset. Condition was assessed taking into account both physical characteristics as well as holistic
                     factors such as functionality, capability, utilisation and obsolescence.

          (iii) Changes in Fair Vatue Measurements using significant unobservable inputs (tevel 3)
                     There have been no transfers between level 1,2 or 3 measurements during the year.

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