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allocate their cost or revalued amounts, net
of their residual values, over their estimated
useful lives, as follows:
Maximum Economic Useful Life*
Infrastructure assets
Ballast. . . . . . . . . . . . . . 60 years
Bridges. . . . . . . . . . . . . 40 years
Culverts . . . . . . . . . . . . 100 years
Rail . . . . . . . . . . . . . . . 110 years
Sleepers. . . . . . . . . . . . . 70 years
Signals & Communications. . . . . 30 years
Turnouts. . . . . . . . . . . . . 60 years
Tunnels. . . . . . . . . . . . . 50 years
Non-Infrastructure assets
Buildings. . . . . . . . . . . . . 50 years
IT & Other equipment. . . . . . . . 4 years
Motor vehicles. . . . . . . . . . . 5 years
Other equipment. . . . . . . . . 40 years
* Depending on the age and location of
particular assets, the economic life may vary.
The maximum economic useful lives are
reviewed at the end of each financial year and
adjusted if required. The current year review
resulted in a maximum useful life change for
turnouts from 15 years to 60 years arising
from extended life of turnout componentry.
The impact on future years is impracticable
to determine to a sufficient level of certainty.
It has not been necessary to adjust useful
lives of turnouts capitalised as Infrastructure
assets are adjusted through the fair value
altering the cost base and depreciation rates
applicable to the individual assets.
(o) Capital work in progress
and capitalisation
Work in progress comprises expenditure on
incomplete capital works. Expenditure on the
acquisition of new infrastructure assets is
capitalised when these new assets increase
the net present value of future cash flows.
Infrastructure assets in the course of
construction are classified as capital work
in progress. Capital works in progress are
recorded at cost, and are not depreciated
until they have been completed and the
assets are ready for economic use.
(p) Intangible assets
Computer software has a finite useful life
and is carried at cost less accumulated
amortisation. Amortisation is calculated using
the straight line method to allocate the cost
of computer software over its estimated
useful life of four years.
Under lease arrangements, ARTC may provide
funds to other bodies to acquire additional
land holdings to enable the infrastructure
to be expanded. ARTC is not entitled to be
reimbursed for this expenditure but has the
right to use the land. The land rights have a
finite useful life expiring in conjunction with
the relevant lease and are carried at cost
less accumulated amortisation. Amortisation
is calculated using the straight line method
to allocate the cost of land rights over its
estimated useful life.
Other intangible assets relate to contractual
rights in relation to a wholesale access
agreement which provides a pricing cap
over the third party infrastructure asset
between Kalgoorlie and Perth which
completes track access between the
east and west coast of Australia.
(q) Trade and other payables
These amounts represent liabilities for goods
and services provided to the Group prior to
the end of financial year which are unpaid and
are measured at amortised cost. The amounts
are unsecured and are usually paid within
30 days of recognition.
Due to their short term nature they are
not discounted.
NOTE 21 (CONTINUED)
SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
105