Notes to the Financial Statements
For the year ended 30 June 2009
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
q) Leases (continued)
All other revenues are recognised on an accruals basis in the Income Statement.
Consolidated Entity as lessor
s) Income tax
Leases in which the Consolidated Entity retains substantially all the risks and benefits of ownership of the leased asset are classified as operating leases. Initial direct costs incurred in negotiating an operating lease are added to the carrying amount of the leased asset and recognised as an expense over the lease term on the same basis as rental income.
Current tax assets and liabilities for the current and prior periods are measured at the amounts expected to be recovered from, or paid to, the taxation authorities based on current year’s
taxable income. The tax rates and tax laws used to compute the amounts are those that are enacted or substantively enacted by the balance sheet date.
r) Revenue recognition
Revenue is recognised at the fair value of the consideration received or receivable, net of Goods and Services Tax (‘GST’).
Deferred income tax is provided on all temporary differences at the balance sheet date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes.
Revenue is recognised for the major business activities as follows:
Revenue and expenses from the sale of land, houses or apartments are recognised when the significant risks and rewards of ownership and effective control have passed to the buyer and it is probable that the economic benefits, which can be reliably measured, will flow to the Consolidated Entity.
Revenue from the sale of land, houses and apartments is generally recognised on settlement. In certain circumstances, land sales are recognised prior to settlement where a signed unconditional contract for sale exists.
Contract building relates to Home Building Agreements and the like, whereby a Controlled Entity contracts to build a house or provide other residential construction services. Contract revenue and expenses are recognised in accordance with the percentage of completion method unless the outcome of the contract cannot be reliably estimated. Where the outcome of a contract cannot be reliably estimated, contract costs are recognised as an expense as incurred, and where it is probable
Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of unused tax credits and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry-forward of unused tax credits and unused tax losses can be utilised.
The carrying amount of deferred income tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilised.
Deferred income tax assets and liabilities are measured using the tax rates that are expected to be applied to the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at balance sheet date.
Deferred tax assets and deferred tax liabilities are offset only if a legally enforceable right exists to set-off current tax assets against current tax liabilities and the deferred tax assets and liabilities relate to the same taxable entity and the same
that the costs will be recovered, revenue is recognised to the extent of cost incurred. The stage of completion is determined based on the completion of the physical program of the contract work. Where it is probable that a loss will arise from a construction contract, the excess of costs over revenue is recognised as an expense immediately.
entities implemented the Tax Consolidation Legislation as of 1 July 2002.
The Head Entity, AVJennings Limited, has entered into an agreement with its wholly-owned subsidiary, AVJennings Properties Limited, under which AVJennings Properties
Limited will account for the current and deferred tax amounts of the controlled entities in the Tax Consolidated Group.
AVJennings Limited ABN 44 004 327 771 35