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FinanceBrief 35

Land Under Roads Acquired Before 1 July 2008

FinanceBriefs are issued by Accounting Policy Branch as guidance on specific accounting and reporting topics.  FinanceBriefs do not take precedence over the financial reporting regulatory framework, which encompasses the Finance Minister's Orders, Australian Accounting Standards and AASB Interpretations.

The purpose of this FinanceBrief is to convey the Commonwealth's election not to recognise land under roads acquired before 1 July 2008 under AASB 1051 Land Under Roads (AASB 1051).    

Background

AASB 1051 requires entities to make an election to recognise or not to recognise land under roads acquired before 1 July 2008.  

Land under roads is land under roadways, and road reserves, including land under footpaths, nature strips and medium strips.1

The road constructed on the land is recognised and measured per AASB 116 Property, Plant and Equipment.

Transitional provisions in AAS 27, 29 and 31 allow Governments the option not to recognise land under roads acquired prior to 31 December 2007.

AASB 1051 requires Governments to elect to extend the relief indefinitely for land under roads acquired before 1 July 2008. 

To ensure consistency across the Commonwealth the Department of Finance and Deregulation have elected that reporting entities covered by:

1. Section 49 of the Financial Management and Accountability Act 1997; or
2. Clause 2 of Schedule 1 to the Commonwealth Authorities and Companies Act 1997

will not recognise land under roads acquired before 1 July 2008.

Land under roads acquired after 30 June 2008

Land under roads acquired after 1 July 2008, that satisfies the asset recognition criteria in the AASB framework, is required to be accounted for in accordance with AASB 116.2

For further information, contact Accounting Policy Branch, Technical Team on (02) 6215 2490.

Full Publication

FinanceBrief 35 - Land Under Roads Acquired Before 1 July 2008 [ 95 KB]

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