Qantas 2013 Annual Report Download - page 109

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QANTAS ANNUAL REPORT 2013
Aircraft Financing Fees
Fees are brought to account as revenue or expenditure
over the period of the respective lease or on a basis which
is representative of the pattern of benets derived from the
leasing transactions, with the unamortised balance being
held in lease and hire purchase liabilities.
Dividend Revenue
Dividends are recognised as revenue when the right to receive
payment is established. Dividends from foreign entities are
recognised net of withholding tax.
H GOODS AND SERVICES TAX GST
Revenues, expenses and assets are recognised net of the
amount of GST, except where the amount of GST incurred is not
recoverable from the taxation authority. In these circumstances,
the GST is recognised as part of the cost of acquisition of the
asset or as part of the expense.
Receivables and payables are stated with the amount of GST
included. The net amount of GST recoverable from, or payable
to, the taxation authority is included as a current asset or
liability in the Consolidated Balance Sheet.
Cash ows are included in the Consolidated Cash Flow
Statement on a gross basis. The GST components of cash
ows arising from investing and nancing activities which are
recoverable from, or payable to, the taxation authority are
classied as operating cash ows.
I INCOME TAX
Income tax expense comprises current and deferred tax. Income
tax expense is recognised in the Consolidated Income Statement
except to the extent that it relates to items recognised directly
in equity or in other comprehensive income, in which case it is
recognised in equity or in other comprehensive income.
Current Tax
Current tax liability is the expected tax payable on the taxable
income for the year, using tax rates enacted or substantially
enacted at balance date and any adjustment to tax payable
with respect to previous years.
Deferred Tax
Deferred tax is recognised in respect of temporary differences
between the carrying amounts of assets and liabilities for
nancial reporting purposes and the amounts used for
taxation purposes. Deferred tax is not recognised for temporary
differences arising from the initial recognition of assets or
liabilities that affect neither accounting nor taxable prot, and
differences relating to investments in controlled entities and
associates and jointly controlled entities to the extent that they
will probably not reverse in the foreseeable future. In addition,
deferred tax is not recognised for taxable temporary differences
arising on the initial recognition of goodwill. The amount of
deferred tax provided is based on the expected manner of
realisation or settlement of the carrying amount of assets and
liabilities, using tax rates enacted or substantially enacted at
balance date.
A deferred tax asset is recognised for unused tax losses, tax
credits and deductible temporary differences only to the extent
that it is probable that future taxable prots will be available
against which the asset can be utilised. Deferred tax assets
are reduced to the extent that it is no longer probable that the
related tax benet will be realised.
Qantas provides for income tax in both Australia and overseas
jurisdictions where a liability exists.
J TAX CONSOLIDATION
Qantas and its Australian wholly-owned controlled entities,
trusts and partnerships are part of a tax consolidated group. As
a consequence, all members of the tax consolidated group are
taxed as a single entity.
K RECEIVABLES
Current receivables are recognised and carried at original
invoice amount less impairment losses. Bad debts are written off
as incurred. Non-current receivables are carried at the present
value of future net cash inows expected to be received.
L CONTRACT WORK IN PROGRESS
Contract work in progress represents the gross unbilled
amount expected to be collected from customers for contract
work performed to date. It is measured at cost plus prot
recognised to date, in accordance with Note 1(G), less an
allowance for foreseeable losses and less progress billings.
Cost includes all expenditure related directly to specic projects
and an allocation of xed and variable overheads incurred
in the Qantas Group’s contract activities based on normal
operating capacity.
Contract work in progress is presented as part of trade and
other receivables in the Consolidated Balance Sheet for all
contracts in which costs incurred plus recognised prots exceed
progress billings. If progress billings exceed costs incurred plus
recognised prots, then the difference is presented as revenue
received in advance in the Consolidated Balance Sheet.
M INVENTORIES
Inventories are measured at the lower of cost and net realisable
value. The costs of engineering expendables, consumable
stores and work in progress are assigned to the individual items
of inventories on the basis of weighted average costs.