NOTES TO THE FINANCIAL STATEMENTSFor the financial year ended 31 March 2022• The contractual terms of the financial assets give riseto cash flows that are solely payments of principal andinterest on the principal amount outstandingAfter initial recognition, these are measured atamortised cost using the effective interest method.Discounting is omitted where the effect of discountingis immaterial. RASWA's cash and cash equivalents, tradeand most other receivables fall into this category offinancial instruments.Impairment of financial assetsAASB 9's impairment requirements use more forwardlooking information to recognise expected credit losses- the 'expected credit losses (ECL) model'. RASWAconsiders a broader range of information when assessingcredit risk and measuring expected credit losses,including past events, current conditions, reasonableand supportable forecasts that affect the expectedcollectability of the future cash flows ofthe instrument.Classification and measurement of financial liabilitiesFinancial liabilities are initially measured at fair value,and, where applicable, adjusted for transaction costsunless RASWA designated a financial liability at fair valuethrough profit and loss. Subsequently, financial liabilitiesare measured at amortised cost using the effectiveinterest method.The effective interest method is a method of calculatingthe amortised cost of a financial liability and of allocatinginterest expense over the relevant period. The effectiveinterest rate is the rate that exactly discounts estimatedfuture cash payments through the expected life of thefinancial liability, or (where appropriate) a shorter period,to the net carrying amount on initial recognition.All interest-related charges and, if applicable, changesin an instrument's fair value that are reported in profit orloss are included within finance costs or sundry revenue.The useful lives of all non-current assets are reviewedat least annually. Where a revision is made to the usefullives of non-current assets, the effect of that revision isincluded in the Statement of Comprehensive Incomeand separately disclosed.Where the carrying value of non current assets decreasesto $5,000 or less, RASWA has a policy of writing theseoff via accelerated depreciation. This is primarily as thecost of maintaining the asset register and the ongoingprocessing of these assets in our view outweighs anybenefits of disclosing these “immaterial items”.(f) Impairment of long-lived assetsAt each reporting date, RASWA reviews the carryingamounts of its assets to determine whether there is anyindication that the assets have suffered an impairmentloss. If any such indication exists, the recoverableamount of the asset is estimated in order to determinethe extent of the impairment, if any. Where the assetdoes not generate cash flows that are independent fromother assets, RASWA estimates the recoverable amountof the cash-generating unit to which the asset belongs.Recoverable amount is the higher of fair value less coststo sell and the value in use. In assessing value in use,the estimated future cash flows are discounted to theirpresent value using a discount rate that reflects currentmarket assessments of the time value of money and therisks specific to the asset.If the recoverable amount of an asset (or cash-generatingunit) is estimated to be less than its carrying amount, thecarrying amount of the asset (cash-generating unit) isreduced to its recoverable amount. An impairment lossis recognised in the profit and loss immediately.(g) Borrowing costsAll borrowing costs are expensed when incurred asRASWA does not have any qualifying assets that requireborrowing costs to be capitalised.(e) Property, plant and equipmentAll non-current assets are initially recorded at cost,being the purchase consideration paid at the date ofacquisition plus costs incidental to the acquisition.(h) Employee entitlements provisionA liability is recognised for benefits accruing to employeesin respect of wages and salaries, annual leave and longservice leave when it is probable that settlement will berequired and they are capable of being measured reliably.All non-current assets except land are depreciatedover their expected economic lives using the straight linemethod. The following rates are used in the calculationof depreciation:Liabilities recognised in respect to employeeentitlements expected to be settled within 12 months aremeasured at their nominal values using the remunerationrates expected to apply at the time of settlement.•••Liabilities recognised in respect to employee entitlementsnot expected to be settled within 12 months are measuredat the present value of estimated future cash outflows tobe made by RASWA in respect of services provided byemployees up to reporting date.Buildings2.5%Improvements to Showground 3% - 5%Plant and equipment5% - 40%R A S WA A N N U A L R E P O R T 2 0 2 223
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