l) Donations in kind
Over the course of the year the company has received donations in kind from a number of local councils in the
form of the right to use premises at discounted rent. The company is of the view that it is not feasible to fair
value the services received accurately and as such it has not brought to account discounted rent as a donation.
m) Trade and other payables
Trade payables and other payables represent liabilities for goods and services provided to the company prior to
the end of the financial year that are unpaid. These amounts are usually settled within 30 days. The carrying
amount of the creditors and payables is deemed to reflect fair value.
n) Provisions
Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past
event, it is probable that the Company will be required to settle the obligation, and a reliable estimate can be
made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present
obligation at reporting date, taking into account the risks and uncertainties surrounding the obligation. Where a
provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the
present value of those cash flows.
When some or all of the economic benefits required to settle a provision are expected to be recovered from a
third party, the receivable is recognised as an asset if it is virtually certain that reimbursement will be received
and the amount of the receivable can be measured reliably.
Provisions for make good are included, where applicable, using the present value of anticipated costs for future
restoration of leased premises. The provision includes future cost estimates associated with closure of the
premises.
o) Unearned income
The liability for unearned income is the unutilised amounts of grants received on the condition that specified
services are delivered or conditions are fulfilled. The services are usually provided or the conditions usually
fulfilled within 12 months of receipt of the grant. Where the amount received is in respect of services to be
provided over a period that exceeds 12 months after the reporting date or the conditions will only be satisfied
more than 12 months after the reporting date, the liability is discounted and presented as non-current.
3. Significant Accounting Judgements, Estimates and Assumptions
The preparation of financial statements requires management to make judgements, estimates and assumptions
that affect the application of policies and reported amounts of assets, liabilities, income and expenses. The estimates
and associated assumptions are based on historical experience and other various factors that are believed to be
reasonable under the circumstances, the results of which form the basis of making the judgements. Actual results
may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates
are recognised in the period in which the estimate is revised if the revision affects only that period or in the period
of the revision and future periods if the revision affects both current and future periods.
Employee entitlements:
Management judgement is applied in determining the following key assumptions used in the calculation of long
service leave at balance date:
• future increases in wages and salaries;
• future on cost rates; and
• experience of employee departures and period of service.
Leasehold improvements
At year end, KU has a significant number of centres where operating leases have expired. Given the uncertainty
of the period over which the Company will continue to occupy these centres, it has determined the useful life
of the leasehold improvements for such centres should not exceed the contracted lease term and therefore the
Company has brought to account additional depreciation of $3,816,534 as referred to in note 4(e) and note 8.
Impairment
In assessing impairment, the Company estimates the recoverable amount of each asset based on the depreciable
replacement cost in accordance with AASB 136 Impairment of assets.
Continues...
117th Annual Report 2012
29