Page 279 - SAMRC AnnualReport 2025-26

F I NAN C IAL I N F O R MA T I O N

ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2026
SIGNIFICANT ACCOUNTING POLICIES
(CONTINUED)

1.4 Biological assets that form part of an agricultural activity
(continued)

Biological assets that form part of an agricultural activity are measured at their fair value less costs to sell.
Agricultural produce harvested from an entity’s biological assets shall be measured at its fair value less
estimated costs to sell at point of harvest.
A gain or loss arising on initial recognition of biological assets at fair value less costs to sell and from a
change in fair value less costs to sell of biological assets is included in surplus or deficit for the period
in which it arises.

An unconditional government grant related to biological assets measured at its fair value less costs to
sell is recognised as income when the government grant becomes receivable.

Where fair value cannot be measured reliably, biological assets are measured at cost less any accumulated
impairment losses.

Horses are classified as biological assets.
1.5 Property, plant and equipment

Property, plant and equipment are tangible non-current assets (including infrastructure assets) that are
held for use in the production or supply of goods or services, rental to others, or for administrative
purposes, and are expected to be used during more than one period.

The cost of an item of property, plant and equipment is recognised as an asset when:
• it is probable that future economic benefits or service potential associated with the item will flow to
the entity; and
• the cost of the item can be measured reliably.
Property, plant and equipment is initially measured at cost.

The cost of an item of property, plant and equipment is the purchase price and other costs attributable
to bring the asset to the location and condition necessary for it to be capable of operating in the manner
intended by management. Trade discounts and rebates are deducted in arriving at the cost. Subsequent
costs of replacing part of an item of property, plant and equipment is recognised in the carrying amount
of the asset if it is probable that the future economic benefits embodied within the part will flow to the
entity and its costs can be measured reliably. The cost of the replaced part is derecognised. The costs of
day to day servicing of property, plant and equipment are recognised in the surplus or deficit.

Where an asset is acquired through a non-exchange transaction, its cost is its fair value as at date of
acquisition.

When significant components of an item of property, plant and equipment have different useful lives,
they are accounted for as separate items (major components) of property, plant and equipment.

The entity identified the following major components of buildings as generators; buildings; prefabricated
buildings; borehole tanks and pumps; water meters; water pipes; air conditioners and the solar system.

The entity identified the following major components of laboratory equipment as laboratory equipment
and irrigation equipment.

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