40 RACING AUSTRALIA ANNUAL REPORT 2023 NOTES TO THE FINANCIAL STATEMENTS mares and foals and the recording of a mare’s progeny and stallion statistics. There are nominal fees for the services provided by the Australian Stud Book for services including, foal & stallion returns, import and export fees, and declaration of services. These revenues are recognised at a point in time when the customer obtains control of the goods, which is generally at the time of the transaction. Foal returns are recognised over a period of time as DNA typing and microchipping services are performed within the first year of birth. Single National System Each Principal Racing Authority (PRA) is charged a fixed rate per horse nomination. Once the horse is nominated into a race or trial, the revenue is recognised. These revenues are recognised at a point in time. Interest Interest revenue is recognised as interest accrues using the effective interest method. This is a method of calculating the amortised cost of a financial asset and allocating the interest income over the relevant period using the effective interest rate, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset at the net carrying amount of the financial asset. Other revenue Other revenue is recognised when it is received or when the right to receive payment is established. Income tax Racing Australia Limited Racing Australia Limited has received a private ruling dated 4 May 2020 from the Australian Taxation Office confirming its exemption from Income Tax under section 50-45 of the Income Tax Assessment Act. This ruling is applicable for the financial periods 1 July 2020 through 30 June 2025. Thoroughbred Trainers Service Centre Limited Current tax Current tax is calculated by reference to the amount of income taxes payable or recoverable in respect of the taxable surplus or deficit for the year. It is calculated using tax rates and tax laws that have been enacted or substantively enacted by the reporting date. Current tax for current and prior periods is recognised as a liability (or asset) to the extent that it is unpaid (or refundable) Deferred tax Deferred tax is accounted for using the comprehensive balance sheet liability method in respect of temporary differences arising from differences between the carrying amount of assets and liabilities in the financial statements and the corresponding tax base for those items. In principle, deferred tax liabilities are recognised for all taxable temporary differences. Deferred tax assets are recognised to the extent that it is probable that sufficient taxable amounts will be available against deductible temporary differences or unused tax losses and tax offsets can be utilised. However, deferred tax assets and liabilities are not recognised if the temporary differences giving rise to them arise from the initial recognition of assets and liabilities (other than as a result of a business combination) which affects neither taxable income nor accounting surplus. Furthermore, a deferred tax liability is not recognised in relation to taxable temporary differences arising from goodwill. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period(s) when the assets and liabilities giving rise to them are realised or settled, based on tax rates (and tax laws) that have been enacted or substantively enacted by reporting date. The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the consolidated entity expects, at reporting date, to recover or settle the carrying amount of its assets and liabilities. Deferred tax assets and liabilities are offset when they relate to income taxes levied by the same taxation authority and the company intends to settle its current tax assets and liabilities on a net basis. Current and deferred tax for the year Current and deferred tax is recognised as either expense or income in the Statement of Profit or Loss and Other Comprehensive Income, except when it relates to items credited or debited directly to equity, in which case the deferred tax is also recognised directly in equity, or where it arises from the initial accounting for a business combination, in which case it is taken into account in the determination of goodwill or excess. Current and non-current classification Assets and liabilities are presented in the Statement of Profit or Loss and Other Comprehensive Income based on current and non-current classification. An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed in the normal operating cycle; it is held primarily for the purpose of trading; it is expected to be realised within 12 months after the reporting period; or the asset is cash or cash equivalent unless restricted from being exchanged or used to settle a liability by at least 12 months after the reporting period. All other assets are classified as non-current. A liability is classified as current when: it is either expected to be settled in normal operating cycle; it is held primarily for the purpose of trading; it is due to be settled within 12 months after the reporting period; or there is no unconditional right to defer the settlement of the liability for at least 12 months after the reporting period. All other liabilities are classified as non-current. Cash and cash equivalents Cash and cash equivalents comprise cash on hand; cash in banks, deposits held at-call with banks and other shortFOR THE YEAR ENDED 30 JUNE 2023
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