Corporate Report for the year ended 30 June 2022
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Section B: Notes to the Group financial statements for the year ended 30 June 2022
Section B: Notes to the Group financial statements for the year ended 30 June 2022
B20 Construction obligation liability West Gate Tunnel Project
The West Gate Tunnel Project is being funded by tolling income from the CityLink Concession Deed and the receipt of future tolling income from the West Gate Tunnel Project. The CityLink Concession Deed was amended in April 2019, requiring the recognition of an incremental asset within other intangible assets and a corresponding liability. The liability represents the Group’s obligation to complete construction of the West Gate Tunnel Project, attributable to the remaining CityLink funding sources payments. The liability will reduce as payments are made in connection with the CityLink funding sources. The estimated nominal value of the remaining funding sources payments attributable to CityLink is $840 million as at 30 June 2022 (2021: $1,291 million) with $840 million due within five years (2021: $1,291 million due within five years).
Current Non-current
West Gate Tunnel Project
West Gate Tunnel Project
Total
$M 579
$M 646
$M
Carrying value at 1 July 2021
1,225
Amounts paid/utilised Unwinding of discount
(451)
— 22
(451)
—
22 —
Transfer
304 432
(304)
Carrying value at 30 June 2022
364
796
Carrying value at 1 July 2020
767
822
1,589
Amounts paid/utilised Unwinding of discount
(405)
— 41
(405)
—
41 —
Transfer
217 579
(217)
Carrying value at 30 June 2021
646
1,225
KEY ESTIMATE AND JUDGEMENT The Group has a construction liability for the West Gate Tunnel Project attributable to the CityLink funding sources payments from the CityLink Concession Deed Amendments. The construction liability is measured at the present value of the remaining CityLink funding sources payments. Assumptions are made in determining the timing and profile, based on the expected cash flows to be paid through completion of construction of the West Gate Tunnel Project, which are discounted to their present value. The current balance represents the payments the Group expects to be made within 12 months from the reporting date, with the non-current portion being the present value of payments beyond 12 months from the reporting date.
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