For personal use only OPERATING SEGMENTS REVENUE RECOGNITION Revenue - goods sold Rendering of services Construction contracts Interest Other revenue Operating segments are presented using the ‘management approach’, where the information presented is on  the same basis as the internal reports provided to the Chief Operating Decision Makers (‘CODM’). The CODM is  responsible for the allocation of resources to operating segments and assessing their performance. Revenue is recognised when it is probable that the economic benefit will flow to the Consolidated Entity and the  revenue can be reliably measured. Revenue is measured at the fair value of the consideration received or receivable. Revenue from the sale of goods and disposal of other assets is recognised when persuasive evidence, usually in  the form of an executed sales agreement, or an arrangement exists, indicating there has been a transfer of risks  and rewards to the customer, no further work or processing is required by the Consolidated Entity, the quantity  and quality of the goods has been determined with reasonable accuracy, the price is fixed or determinable,  and collectability is reasonably assured. This is generally when title passes. The majority of the Consolidated  Entity’s sales agreements specify that title passes when the product is delivered to the destination specified by  the customer, which is typically the vessel on which the product will be shipped. In practical terms, revenue is  generally recognised on the bill of lading date, which is the date the commodity is delivered to the shipping agent.  These sales agreements also allow for an adjustment to the sales price based on a survey of the goods by the  customer (an assay for mineral content), therefore recognition of the sales revenue is based on the most recently  determined estimate of product specifications.  Revenue from services rendered is recognised in the statement of profit or loss and other comprehensive income  in proportion to the stage of completion of the transaction at the reporting date. The stage of completion is  assessed by reference to work performed. No revenue is recognised if there are significant uncertainties regarding recovery of the consideration due or if the  costs incurred or to be incurred cannot be measured reliably. Contract revenue and expenses are generally recognised on an individual contract basis using percentage of  completion method when the stage or contract completion can be reliably determined, costs to date can be clearly  identified, and total contract revenue and costs to complete can be reliably estimated. Two or more contracts are  treated as a single contract where the contracts are negotiated as a single package, are closely interrelated and  are performed concurrently or in a continuous sequence. Profit recognition for lump sum fixed price contracts does not commence until cost to completion can be reliably  measured. Stage of contract completion is generally measured by reference to physical completion. An assessment of total  labour hours and other costs incurred to date as a percentage of estimated total costs for each contract is used if  it is an appropriate proxy for physical completion. Task-lists, milestones, etc. are also used to calculate or confirm  the percentage of completion if appropriate. Where the outcome of a contract cannot be reliably estimated, contract costs are expensed as incurred. Where it  is probable that the costs will be recovered, revenue is recognised to the extent of costs incurred. An expected loss  is recognised immediately as an expense. Interest revenue is recognised as interest accrues using the effective interest method. This is a method of  calculating the amortised cost of a financial asset and allocating the interest income over the relevant period  using the effective interest rate, which is the rate that exactly discounts estimated future cash receipts through  the expected life of the financial asset to the net carrying amount of the financial asset. Other revenue is recognised when it is received or when the right to receive payment is established. Notes to the  Financial  Statements 30 June 2014 Notes to the Financial Statements