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NOTES TO THE FINANCIAL STATEMENTS CONTINUED

The Group Parent Entity

2007
$’000
2006
$’000
2007
$’000
2006
$’000
NOTE 17 — PROPERTY, PLANT AND
EQUIPMENT (CONTINUED)
Buildings and improvements subject to long term leases
At cost at the beginning of the year
Less: Accumulated amortisation at the beginning of the year
104,167
(38,178)
102,438
(35,137)
—
—
—
—
Net balance at the beginning of the year
Additions
Acquisition through business acquired
Transfer from capital works in progress
Net foreign currency differences on translation of foreign operations
Disposals
Amortisation
Disposal through sale of business
65,989
325
485
22
(1,549)
(19)
(3,474)
(2,818)
67,301
948
—
—
1,628
(168)
(3,720)
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
Net balance at the end of the year 58,961 65,989 — —
Capital works in progress
Balance at the beginning of the year
Net foreign currency differences on translation of foreign operations
Additions
Transfer from capital works in progress
1,778
76
4,581
(1,237)
831
(182)
1,959
(830)
—
—
—
—
—
—
—
—
Balance at the end of the year 5,198 1,778 — —
Plant and equipment
At cost at the beginning of the year
Less: Accumulated depreciation at the beginning of the year
351,727
(241,602)
334,724
(225,027)
844
(726)
825
(668)
Net balance at the beginning of the year
Additions
Acquisitions through business acquired
Transfer from capital works in progress
Net foreign currency differences on translation of foreign operations
Disposals
Disposals through sale of business
Reclassification to software
Depreciation
Impairment carrying value adjustments
110,125
13,899
58
1,002
(2,634)
(798)
(760)
—
(20,452)
—
109,697
25,524
—
87
3,427
(27)
—
(415)
(20,959)
(7,209)
118
16
—
—
—
(6)
—
—
(38)
—
157
19
—
—
—
—
—
—
(58)
—
Net balance at the end of the year 100,440 110,125 90 118
Leased plant and equipment
At cost at the beginning of the year
Less: Accumulated amortisation at the beginning of the year
—
—
83
(83)
—
—
—
—
Net balance at the beginning of the year
Acquisition through entity acquired
Amortisation
—
969
(82)
—
—
—
—
—
—
—
—
—
Net balance at the end of the year 887 — — —

Independent valuations of land and buildings

In determining current values for the Group’s interest in land and buildings and integral plant and equipment, including long term
leasehold land and improvements, directors have relied upon independent valuations from registered qualified valuers. Except for
investment properties, which are revalued every year (refer Note 18), valuations are carried out on a progressive three-year cycle.
All business segments are not valued at the one time, the last valuations being completed as at 30 June 2006 and 2007.

NOTE 17 — PROPERTY, PLANT AND EQUIPMENT (CONTINUED)

Most recent valuations of land and buildings, excluding investment properties

Due to the diversity of the Group’s operations, valuations have been prepared on a highest and best alternate use or existing use
(going concern) basis. It is considered that these valuations best approximate the fair values of the properties at the dates of the
valuations. A summary is set out as follows:

The Group Parent Entity

2007
$’000
2006
$’000
2007
$’000
2006
$’000
Highest and best alternate use:
Independent valuation — 2007
Independent valuation — 2004
Existing use:
Independent valuation — 2007
Independent valuation — 2006
Independent valuation — 2005
Independent valuation — 2004
83,000
—
422,857
231,246
—
—
—
59,165
—
296,989
10,600
244,637
—
—
—
—
—
—
—
—
—
—
—
—
Current year additions not yet independently valued
737,103
—
611,391
12,952
—
—
—
—
737,103 624,343 — —
The written-down book value of assets, shown in the financial
statements as plant and equipment and which are deemed integral
to land and buildings, has been determined to total approximately
$42,838,000 as at 30 June 2007 (2006: $32,200,000).
In determining the current value of land and buildings, the directors
have not taken into account the potential impact of capital gains tax.
Impairment losses recognised — prior year
During the 2006 financial year, a decline in the trading performance
at a number of cinema sites in Germany (Cinema Exhibition
International segment) resulted in a reassessment of the recoverable
amount of plant and equipment at those cinema sites. Based on
this assessment, the carrying amount of plant and equipment at
a number of cinema sites was written down by $5,174,000 in the
2006 financial year (2007: $nil). The estimated recoverable amounts
were based on the plant and equipment value in use, determined
using a pre-tax discount rate of 10 per cent per annum.
Security
The following assets, whose carrying values are listed below, are
subject to mortgage security (fixed and floating charge prior year)
to secure the Group’s bank loan facilities. Refer Note 23.
Freehold land and buildings 157,702 262,572 — —
Land subject to long term lease — 56 — —
Buildings and improvements subject to long term lease — 42,369 — —
Capital works in progress — 1,778 — —
Plant and equipment — 67,049 90 118
Investment properties 29,900 24,900 — —
187,602 398,724 90 118

Land and buildings subject to finance lease

The Group leases a property under a finance lease agreement. At the end of the lease, the Group has the option to purchase the
property at no additional cost. If this option is not exercised, the Group can occupy the premises for a further five-year period
rent-free. At 30 June 2007, the net carrying amount of the property was $28,467,000 (2006: $31,533,000). The leased property
secures lease obligations.