1) Future tolling rights are legal claims to collect charge from public levied for passage along a particular road, highway, or bridge, at a later time (Oxford Advanced Learner’s Dictionary). Future tolling rights of the M7 toll-road are BrisConnections’ intangible assets. The road is a public-private partnership with the Queensland government (Wikipedia), in which private companies build the roads and are given a limited franchise. When the franchise expires, ownership is transferred to the government. BrisConnections’ annual report showed that future tolling rights is provided by the government through the concession deed. This is an agreement which concedes the use of the road to the project company for a specified period, signed by the entity established by the State in relation to the design and construction.
2) According to AASB Framework paragraph 49, “an asset is a resource controlled by the entity as a result of past events and from which future economic benefits are expected to flow to the entity”. Obviously, future tolling rights asset satisfies all the definition of assets. First of all, BrisConnections company is provided with this right by the State government through the concession deed, hence it has full legal claim to collect toll fees. Second, this is a result of a past event as The City North Infrastructure indicated in 2008 that BrisConnections is the winning bidder for the contract to build the airport link, and as such, it can build and collect toll for a specific period of time. When the franchise expires, ownership is transferred to the government. Finally, the future tolling right will generate cash inflow for the company in the future through tolling fee. To be more specific, this is an intangible asset as the “right” is a legal claim, which is an identifiable non-monetary asset without physical substance.
3) The AASB 136 indicated that there are four steps in the procedure by which an entity tests an intangible asset for...
References: 1. BrisConnections, 2012, “2012 Annual Report”
2. CPA Australia, 2013, “Accounting Handbook 2013”, Pearson, Australia
3. City North Infrastructure, 2012, “Airport Link”, http://www.citynorthinfrastructure.com.au/airport-link.php, accessed 15/05/2013
4. Oxford University, 2009, “Oxford Advanced Learner’s Dictionary”, Oxford University Press, England
5. Wikipedia, 2013, “Airport Link, Brisbane”, http://en.wikipedia.org/wiki/Airport_Link,_Brisbane#cite_note-4, accessed 15/05/2013
6. Wikipedia, 2013, “Project Finance”, http://en.wikipedia.org/wiki/Project_finance, accessed 15/05/2013
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