Telstra 2016 Annual Report Download - page 153

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Section Title | Telstra Annual Report 2016
Notes to the financial statements (continued) Telstra Financial Report 2016
Section 7. Other information (continued)
Telstra Corporation Limited and controlled entities | 151
7.1 Other accounting policies (continued)
7.1.3 New accounting standards to be applied in future reporting
periods (continued)
(c) New leasing standard (continued)
AASB 16 substantially carries forward the lessor accounting
requirements in AASB 117. Accordingly, a lessor continues to classify
its leases and account for them as operating leases or finance
leases.
There is an optional exemption for certain short-term leases and
leases of low-value assets; however, this exemption can only be
applied by lessees.
The new standard will apply to Telstra from 1 July 2019. Earlier
adoption is permitted, but only in conjunction with AASB 15:
'Revenue from Contracts with Customers'.
We are currently assessing the impact of the new leasing standard
on our financial results.
(d) Other
We do not expect any other recently issued accounting standards to
have a material impact on our financial results upon adoption.
7.2 Auditor’s remuneration
Audit related fees charged by EY are for services that are reasonably
related to the performance of the audit or review of our financial
reports and for other assurance engagements. These services
include regulatory financial assurance services, services over debt
raising prospectuses, additional control assessments, various
accounting advice and additional audit services related to our
controlled entities.
The above fees are inclusive of fees charged to the Autohome Group
entities, which we ceased to control on 23 June 2016.
We have processes in place to maintain the independence of the
external auditor, including the level of expenditure on non-audit
services. EY also has specific internal processes in place to ensure
auditor independence.
7.3 Parent entity disclosures
Tables A and B provide summary of financial information for the
Telstra Entity.
Total non-current assets include reversal of impairment of $1,314
million (2015: $1,093 million impairment loss) recognised in the
income statement and relating to the value of our investments in,
and amounts owed by, our controlled entities. The impairment losses
have been eliminated on consolidation of the Telstra Group.
7.3.1 Property, plant and equipment commitments
Table C provides details of our expenditure commitments for the
acquisition of property, plant or equipment, which have been
contracted for at balance date but not recognised in the financial
statements.
Our external auditor of the Group is Ernst & Young (EY). In
addition to the audit and review of our financial reports, EY
provides other services throughout the year. This note shows
the total fees to external auditors split between audit, audit
related and non-audit services.
Telstra Group Year ended 30 June
2016 2015
$m $m
Audit fees
EY fees for the audit and review of the
financial reports 9.390 8.104
Other services
Audit related 1.216 1.324
Non-audit services
- Tax services 0.059 0.015
- Advisory services 0.568 0.105
Total other services provided by EY 1.843 1.444
This note provides details of Telstra Entity financial
performance and financial position as a standalone entity. The
results include transactions with its controlled entities.
Table A As at 30 June
Telstra Entity 2016 2015
$m $m
Statement of financial position
Total current assets 9,030 5,720
Total non-current assets 36,169 33,849
Total assets 45,199 39,569
Total current liabilities 12,553 8,970
Total non-current liabilities 17,515 17,091
Total liabilities 30,068 26,061
Share capital 5,167 5,198
Cash flow hedging reserve (93) (114)
Foreign currency basis spread reserve 48 50
General reserve 194 194
Retained profits 9,815 8,180
Total equity 15,131 13,508
Table B Year ended 30 June
Telstra Entity 2016 2015
$m $m
Statement of comprehensive income
Profit for the year 5,633 4,631
Total comprehensive income 5,441 4,859
Table C As at 30 June
Telstra Entity 2016 2015
$m $m
Total property, plant and equipment
expenditure commitments 1,101 666