92 / 116
$’000
Opening balance 1 July 2014
4,077,219
Additions
401,236
Loss included in expenses
(25,525)
Depreciation
(168,424)
Changes in fair value included in other comprehensive income
(62,422)
Closing balance 30 June 2015
4,222,084
Additions
173,359
Gain included in expenses
3,015
Depreciation
(176,093)
Disposals
(7)
Change in fair value included in other comprehensive income
(197,514)
Closing balance 30 June 2016
4,024,844
(iv) Valuation inputs and relationships to fair value
The following table summarises the information about the significant unobservable inputs used in
level 3 fair value infrastructure asset measurements. See (ii) above for the valuation techniques
adopted.
Valuation technique
Significant
unobservable
inputs
Inter-relationship between
significant unobservable inputs
and fair value measurements
Discounted cash flows:
The valuation model considers
the present value of expected
payment, discounted using a
risk-adjusted discount rate.
The expected payment is
determined by considering
the cashflow forecasts for
each business unit which is
comprised of the relevant CGUs.
Risk adjustments are made and
terminal value calculations are
completed on a probability basis.
Forecast
annual revenue,
Maintenance and
capital expenditure,
Risk-adjusted
discount rate
The estimated fair value would
increase (decrease) if; the annual
revenue growth rate were higher
(lower), if maintenance and capital
expenditure were lower (higher);
or the risk-adjusted discount rate
were lower (higher). Generally a
change in the annual revenue growth
rate is accompanied by a directionally
similar change in maintenance and
capital expenditure.
(iii) Fair value measurements using significant unobservable inputs (level 3)
The following table presents the changes in level 3 items for the periods ended 30 June 2015 and 30
June 2016 for the Group:
NOTE 12 (CONTINUED)
FINANCIAL RISK MANAGEMENT
(d) Fair value measurements (continued)
90