Berry Street Web Docs Financial Report 2009 | Page 9

BERRY STREET VICTORIA INC . ABN 24 719 196 762 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2009

NOTE 1 : STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES ( Continued )

( a ) Property ( Continued ) Depreciation

The depreciable amounts of all fixed assets are depreciated over the useful lives of the assets to the association commencing from the time the asset was held ready for use . Leasehold improvements are amortised over the shorter of either the unexpired period of the lease or the estimated useful lives of the improvements .

The depreciation rates used for each class of depreciable assets are :

Class of fixed asset Depreciation rates Depreciation basis

The assets ’ residual values and useful lives are reviewed , and adjusted if appropriate , at each balance sheet date .

An asset ’ s carrying amount is written down immediately to its recoverable amount if the asset ’ s carrying amount is greater than its estimated recoverable amount .

Gains and losses on disposals are determined by comparing proceeds with the carrying amount . These gains or losses are included in the Income Statement . When revalued assets are sold , amounts included in the revaluation reserve relating to that asset are transferred to retained earnings .

( b ) Leases

Leases of fixed assets , where substantially all the risks and benefits incidental to the ownership of the asset but not the legal ownership , are classified as finance leases . Finance leases are capitalised , recording an asset and a liability equal to the present value of the minimum lease payments , including any guaranteed residual values . Leased assets are depreciated on a straight line basis over their estimated useful lives where it is likely that the association will obtain ownership of the asset . Lease payments are allocated between the reduction of the lease liability and the lease interest expense for the period .

Lease payments for operating leases , where substantially all the risks and benefits remain with the lessor , are charged as expenses in the period in which they are incurred .

( c ) Employee Benefits

Provision is made for the association ’ s liability for employee benefits arising from services rendered by employees to Balance Sheet date . Employee benefits expected to be settled within one year together with benefits arising from wages , salaries and annual leave which may be settled after one year , have been measured at the amounts expected to be paid when the liability is settled plus related on-costs . Other employee benefits payable later than one year have been measured at the net present value using the government bond rate that corresponds to the estimated future cash outflows to be made for those benefits .

Contributions are made by the association to an employee superannuation fund and are charged as expenses when incurred .

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