Annual Report 2015-16

Financial Statements 2016

 Noosa Shire Council

 Notes to the Financial Statements
 for the year ended 30 June 2016
 Note 12. Fair Value Measurements (continued)

Other Infrastructure Assets (level 3)
Other Infrastructure was last comprehensively valued as at 30 June 2016 by Aurecon Australia Pty Ltd.
The valuation technique used to determine fair value is essentially based on price modelling of the fair value through
‘Level 3' unobservable inputs. These include a variety of sources to obtain the best information available for each asset
type, including actual contract prices or supply quotes for similar assets.
The unit rates were predominantly developed from first principles by estimating the plant, material and labour required for
asset replacement. The base rates were sourced from local suppliers estimates and quotes, contract schedules for work
recently completed and council records. Where costs have not been readily available then rates were obtained from
Aurecon's cost database or the Rawlinson 2014 edition of the Australian Construction Handbook.

Accumulated Depreciation
In determining the level of accumulated depreciation, assets are disaggregated into significant components which exhibit
different useful lives. Useful lives are an estimate of the total service capacity in years for that type of asset.
Infrastructure Assets (level 3)
Due to the specialised nature of Council's infrastructure assets and the services they provide, there is no active
measurable market. The fair value of all infrastructure assets is determined on the basis of replacement of a new asset or
modern equivalent.
Current Replacement Cost (CRC) is measured by reference to the lowest cost at which the gross economic benefits of
the asset could be obtained in the normal course of business. Where existing assets were over designed, had excess
capacity or where redundant an adjustment was made so that the resulting valuation reflected the cost of replacing the
existing economic benefits based on an efficient set of modern equivalent assets to achieve the required level of service
output within the Council's planning horizon.
Infrastructure assets are comprehensively revalued every three to five years, based on component unit rates developed
in line with asset renewal methods.

                                                                                                          page 26