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Accounting Choice and Theory in Crisis: The Case of the Victorian Desalination Plant
Author(s) -
TanKantor Angela,
Abbott Malcolm,
Jubb Christine
Publication year - 2017
Publication title -
australian accounting review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.551
H-Index - 36
eISSN - 1835-2561
pISSN - 1035-6908
DOI - 10.1111/auar.12149
Subject(s) - desalination , general partnership , asset (computer security) , accounting , government (linguistics) , governmental accounting , business , state (computer science) , economics , finance , financial accounting , accounting information system , fund accounting , computer science , linguistics , genetics , computer security , algorithm , membrane , biology , philosophy
This paper traces the financial developments of the desalination plant in the State of Victoria in Australia. The desalination plant was built via a public–private partnership (PPP) vehicle, and commissioned at a time when water storage levels in the state were low. Subsequent rainfall has meant that no water has yet been ordered by the Victorian Government from the plant. In the paper an analysis is undertaken of the impact of the manner in which accounting treatment has been used in valuing this infrastructure asset. It is concluded that the applied accounting policy choices and treatments for this infrastructure asset are not consistent with conventional accounting theory, the Conceptual Framework for accounting or generally accepted accounting principles.