42 RACING AUSTRALIA ANNUAL REPORT 2024 NOTES TO THE FINANCIAL STATEMENTS 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). Trade and other Receivables Trade receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective interest method, less any allowance for expected credit losses. Trade receivables are generally due for settlement within 30 days. Collectability of trade receivables is reviewed on an ongoing basis. Debts which are known to be uncollectable are written off using the carrying amount directly. Other receivables are recognised at amortised cost, less any provision for impairment. Plant and equipment Plant and equipment is stated at historical cost less accumulated depreciation and impairment. Historical cost includes expenditure that is directly attributable to the acquisition of the item. In the event that settlement of all or part of the purchase consideration is deferred, cost is determined by discounting the amounts payable in the future to their present value at the date of acquisition. Depreciation is provided on plant and equipment. Depreciation is calculated on a straight-line basis so as to write off the net cost or other revalued amount of each asset over its expected useful life to its estimated residual value. The estimated useful lives, residual values and depreciation method are reviewed at the end of each annual reporting period. The following estimated useful lives are used in the calculation of depreciation: Plant and equipment 3 - 5 years Intangible assets Computer software and databases Computer software and databases are recorded at cost less accumulated amortisation and impairment. Amortisation is charged on a straight-line basis over its estimated useful life being 3 years. The estimated useful life and amortisation method is reviewed at the end of each annual reporting period. The investment in the Single National System software and database is recorded at cost less accumulated amortisation and impairment. Amortisation is charged on a straight-line basis over its estimated useful life being 5 years. The estimated useful life and amortisation method is reviewed at the end of each annual reporting period. Australian Stud Book The Australian Stud Book is recorded at cost and is subject to annual impairment testing. The directors consider that the Australian Stud Book has an indefinite life and as a result, has not been amortised. Goodwill Goodwill arises on the acquisition of a business. Goodwill is not amortised. Instead, goodwill is tested annually for impairment, or more frequently if events or changes in circumstances indicate that it might be impaired and is carried at cost less accumulated impairment losses. Impairment losses on goodwill are taken to profit or loss and are not subsequently reversed. Impairment of non-financial assets Goodwill and other intangible assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment or more frequently if events or changes in circumstances indicate that they might be impaired. Other non-financial assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the assets carrying amount exceeds its recoverable amount. Recoverable amount is the higher of an assets fair value less the cost of disposal and value-in-use. The value-inuse is the present value of the estimated future cash flows FOR THE YEAR ENDED 30 JUNE 2024
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