Document ID: chunk:federal_register_of_legislation:F2022C00554:body:0:p95
Version: federal_register_of_legislation:F2022C00554
Segment Type: other
Provision Reference: 
Character Range: 288807–291769

the cost approach to fair value in AASB 13. However, AASB 13 and the corresponding IFRS 13 do not specify which valuation technique to use. Instead IFRS 13 requires the use of valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs. Three widely used valuation techniques set out in IFRS 13 are the market approach, the cost approach and the income approach. The requirement of this Standard to initially measure a service concession asset at current replacement cost in accordance with the cost approach may not be compliant with IFRS 13. .

     BC126        This Standard requires a grantor to recognise an identifiable intangible asset as a service concession asset where the grantor controls the asset as set out in paragraph 5 or 6, even if the asset does not qualify for recognition under AASB 138/IAS 38 Intangible Assets. This approach is explained in paragraph BC39.

     BC127        Under this Standard, a grantor recognises revenue from granting a right to the operator over the term of the service concession arrangement on an appropriate basis. This may not be compliant with the permitted approaches to revenue recognition for licences of intellectual property, if IFRS 15 Revenue from Contracts with Customers applied in the absence of grantor accounting requirements. In developing this Standard, the Board decided not to apply the licence revenue requirements of AASB 15 by analogy.

Comparison with AASB Interpretation 12
     BC128        This Standard addresses the key requirements of AASB Interpretation 12 from a grantor's perspective, in particular the criteria for the recognition of a service concession asset in paragraphs 5 and 6. The main differences between this Standard and AASB Interpretation 12 are detailed in the paragraphs below.

     BC129        The scope of this Standard does not explicitly state whether the operator should be a public or private sector entity. This contrasts with AASB Interpretation 12, which states that the Interpretation gives guidance on the accounting by operators for public-to-private service concession arrangements (paragraph 4).

     BC130        This Standard applies to arrangements involving a 'service concession asset', including intangible assets and land under roads. This is broader than AASB Interpretation 12, which is applicable to infrastructure but does not refer explicitly to such assets.

     BC131        This Standard requires the grantor to recognise a financial liability when the grantor has a contractual obligation to pay cash to the operator for third-party usage of a service concession asset, with or without guaranteeing a minimum amount to the operator. This contrasts with AASB Interpretation 12, which links the recognition of a financial asset by an operator to a guarantee of the cash