Annual Report 2023-24

      Noosa Council                                                                                                                           Noosa Council




                                                                                                                                                                                                                                                                                        Financial Performance
      Notes to the Financial Statements                                                                                                       Notes to the Financial Statements
      for the year ended 30 June 2024                                                                                                         for the year ended 30 June 2024

      Note 15. Property, Plant and Equipment (continued)                                                                                      Note 15. Property, Plant and Equipment (continued)
                                                                                                                                              §Note/Subtotal§



      §Note/Subtotal§




      (a) Recognition and Measurement                                                                                                         (c) Impairment
      Recognition                                                                                                                             Property, plant and equipment held at cost is assessed for indicators of impairment annually. If an indicator of possible
                                                                                                                                              impairment exists, the Council determines the asset's recoverable amount. Any amount by which the asset's carrying
      Each class of property, plant and equipment is carried at cost or fair value less, where applicable, any accumulated depreciation       amount exceeds the recoverable amount is recorded as an impairment loss.
      and accumulated impairment losses. Items of property, plant and equipment with a total value of less than $5,000, $1,000 for
      computer equipment and $15,000 for buildings, except for land and network assets (which have a recognition threshold of $1)             (d) Valuation
                                                                                                                                              §Subnote§




      are treated as an expense in the year of acquisition. All other items of property, plant and equipment are capitalised.
                                                                                                                                              Land and improvements, buildings, major plant and all infrastructure assets are measured on the revaluation basis, at fair
      The classes of property, plant and equipment recognised by Council are set out in the table contained in this note.                     value, in accordance with AASB 116 Property, Plant and Equipment and AASB 13 Fair Value Measurement requirements.
                                                                                                                                              Other plant and equipment and work in progress are measured at cost.
      Acquisition of Assets
                                                                                                                                              Non-current physical assets measured at fair value are revalued, where required, so that the carrying amount of each class of
      Acquisitions of assets are initially recorded at cost. Cost is determined as the fair value of the assets given as consideration        asset does not materially differ from its fair value at the reporting date. This is achieved by engaging independent, professionally
      plus costs incidental to the acquisition, including freight in, architect's fees, engineering design fees and all other establishment   qualified valuers to determine the fair value for each class of property, plant and equipment assets every three to five years.
      costs.                                                                                                                                  This process involves the valuer physically sighting a representative sample of Council assets across all asset classes and
                                                                                                                                              making their own assessments of the condition of the assets at the date of inspection.
      Property, plant and equipment received in the form of contributions, are recognised as assets and revenues at fair value by
      Council valuation where that value exceeds the recognition thresholds for the respective asset class. Fair value is the price           Council uses internal and external engineers to assess the condition and cost assumptions associated with all infrastructure
      that would be received to sell the asset in an orderly transaction between market participants at the measurement date.                 assets, the results of which are considered in combination with the relevant cost index for region. Together these are used to
                                                                                                                                              form the basis of a management valuation for infrastructure asset classes in each of the intervening years.
      Routine operating maintenance, repair costs and minor renewals to maintain the operational capacity and useful life of the
      non-current asset is expensed as incurred, while expenditure that relates to replacement of a major component of an asset               With respect to the valuation of land and improvements, and buildings classes in the intervening years, management performs
      to maintain its service potential is capitalised.                                                                                       a desktop valuation. A desktop valuation involves management assessing the condition and cost assumptions associated with
                                                                                                                                              each asset class in conjunction with the movements in the relevant indices as outlined in the valuation techniques table in Note
      Capital Work in Progress                                                                                                                15(3). In some instances, Council will obtain industry indices from appropriately qualified valuers to make an assessment of
230                                                                                                                                           fair value movements together these are used to form the basis of the desktop valuation. Indexation is only applied where                 231
      The cost of property, plant and equipment being constructed by Council includes the cost of purchased services, materials,              the cumulative change in the index from the most recent comprehensive valuation is more than 5%, this avoids volatility in
      direct labour and an appropriate proportion of labour overheads.                                                                        fair values in the interceding years.

      (b) Depreciation                                                                                                                        Recognised Fair Value Measurement
      §Subnote§




      Land, work in progress, certain cultural and heritage assets with heritage listing, road formations and formation work associated       Council measures and recognises the following assets at fair value on a recurring basis:
      with the construction of dams, levee banks and reservoirs are not depreciated.                                                            • Investment property
                                                                                                                                                • Land
      Depreciation, where applicable, is calculated on a straight-line basis. Management believe that the straight-line basis                   • Buildings
      appropriately reflects the pattern of consumption of all Council assets                                                                   • Road and bridge network
                                                                                                                                                • Storm water
      Management reviews its estimate of the useful lives of depreciable assets at each reporting date, based on the expected                   • Other infrastructure assets
      utility of the assets. Uncertainties in these estimates relate to technical or physical obsolescence that may change the util-
      ity of infrastructure assets.                                                                                                           Council does not measure any liabilities at fair value on a recurring basis.

                                                                                                                                              In accordance with AASB 13 fair value measurements are categorised on the following basis:

                                                                                                                                              Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities,

                                                                                                                                              Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability either directly
                                                                                                                                                       or indirectly,

                                                                                                                                              Level 3: Inputs for the asset or liability that are not based on observable market data (unobservable inputs).




                                                                                                                                                                                                                                                                                        Noosa Council Annual Report 23/24
                                                                                                                                              The fair values of the assets are determined using valuation techniques which maximise the use of observable data, where it is
                                                                                                                                              available, and minimise the use of entity specific estimates. If all significant inputs required to fair value an asset are observable,
                                                                                                                                              the asset is included in Level 2. If one or more of the significant inputs is not based on observable market data, the asset is
                                                                                                                                              included in Level 3. This is the case for Council infrastructure assets, which are of a specialist nature for which there is no active
                                                                                                                                              market for similar or identical assets. These assets are valued using a combination of observable and unobservable inputs.

                                                                                                                                              The table below presents all items that are measured and recognised within the Statement of Financial Position at fair value.
                                                                                                                                              In accordance with AASB 13, all fair value measurements are on a recurring basis and categorised as either Level 2 or Level
                                                                                                                                              3 fair value measurements. Council does not have any assets or liabilities measured at fair value which meet the criteria for
                                                                                                                                              categorisation as Level 1.


      continued on next page ...                                                                                              Page 25 of 60   continued on next page ...                                                                                                Page 26 of 60