Document ID: chunk:federal_register_of_legislation:F2022C00554:body:0:p26
Version: federal_register_of_legislation:F2022C00554
Segment Type: other
Provision Reference: 
Character Range: 69301–72328

concession asset and those for other components of the service concession arrangement (eg maintenance and operation services) on the basis of their relative fair values.  The fair value (current replacement cost) of the service concession asset represents amounts related to the asset and excludes other components of the service concession arrangement.  In some cases, identifying payments for the asset and payments for other components of the service concession arrangement will require the grantor to use an estimation technique.  For example, a grantor may estimate the payments related to the asset by reference to the fair value of a comparable asset in an agreement that contains no other components, or by estimating the payments for the other components in the service concession arrangement by reference to comparable arrangements and then deducting these payments from the total payments under the arrangement.

Operator receives other forms of compensation
     B55                The types of compensation transactions referred to in paragraph 14(b) are non-monetary exchange transactions. Paragraph 24 of AASB 116 and paragraph 45 of AASB 138, as appropriate, provide guidance on these circumstances.
     B56                When the operator is granted the right to earn revenue from third-party users of the service concession asset, or from another revenue-generating asset, or receives non-cash compensation from the grantor, the grantor does not incur a cost directly for acquiring the service concession asset.  These forms of consideration to the operator may be intended to compensate the operator both for the cost of the service concession asset and for operating it during the term of the service concession arrangement.  The grantor therefore needs to initially measure the asset component in a manner consistent with paragraph 7.

Fair value measurement
     B57                A service concession asset is an asset that is obtained through construction, development, upgrade, major component replacement or acquisition, an existing asset or upgrade or major component replacement of an existing asset, to provide public services in a service concession arrangement. The capacity or service potential of the asset is used to achieve public service objectives irrespective of whether the cost of the asset will be recovered by the expected cash flows that the asset may generate. The asset is initially measured at fair value, which is the current replacement cost under the cost approach. The current replacement cost reflects the amount that would be required at the time to replace the service capacity of an asset. The asset is measured at current replacement cost whether the related liability is measured under the financial liability model, the grant of the right to the operator model, or both.

Subsequent measurement
     B58                For consistency with the approach to the initial measurement of service concession assets recognised in accordance with this Standard, references to