RTIA Annual Report E-Book

Road Traffic Infringement Agency Annual Financial Statements for the year ended 31 March 2024 __________________________________________________________________________________________________________________________________________________________ Significant Accounting Policies

1.3 Contingencies Contingent assets and contingent liabilities are not recognised. Contingencies are disclosed, unless the possibility of flow of resources is remote. If the disclosures of contingencies may seriously prejudice the entity then the general nature of the contingency is disclosed, together with the reason as to why further information is not disclosed. Management considers the existence of possible obligations which may arise from legal action. The estimation of the amounts disclosed is based on the expected possible outflows of economic benefits should there be a present obligation. After their initial recognition, contingent liabilities recognised in entity combinations that are recognised separately are subsequently measured at the higher of: - the amount that would be recognised as a provision; and - the amount initially recognised less cumulative amortisation. 1.4 Property, plant and equipment The cost of an item of property, plant and equipment is recognised as an asset when:

Provisions are not recognised for future operating surplus (deficit).

If an entity has a contract that is onerous, the present obligation under the contract is recognised and measured as a provision. A constructive obligation to restructure arises only when an entity:

- has a detailed formal plan for the restructuring, identifying at least: - the business or part of a business concerned; - the principal locations affected; - the location, function and approximate number of employees who will be compensated for terminating their services; - the expenditures that will be undertaken; and - when the plan will be implemented; and - has raised a valid expectation in those affected that it will carry out the restructuring by starting to implement that plan or announcing its main features to those affected by it.

Litigation costs

Litigation costs based on the estimated legal fees, including but not limited to damages based on the probable costs’ payable on completion of the cases against RTIA.

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the Agency has full control over it; and

- 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

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Road Traffic Infringement Agency • Annual Report 2023/24