✨ Financial Statements Notes
2950 NEW ZEALAND GAZETTE No. 117
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 1996
- STATEMENT OF ACCOUNTING POLICIES
a. Reporting Entity
These financial statements for Egmont Electricity Limited have been prepared for the purposes of
the Electricity (Disclosure Requirements) Act 1994.
b. Measurement Base
The measurement base adopted is that of historical cost except for the revaluation of certain assets.
Accrual accounting is used to match expenses and revenue. The accounts have been prepared
exclusive of Goods and Services Tax.
c. Specific Accounting Policies
The following specific accounting policies which significantly affect the measurement of profit and
of financial position, have been applied:
(i) COMPLIANCE WITH THE DISCLOSURE GUIDELINES
The methodology applied for the allocation of costs, revenues, assets and liabilities has been
in accordance with the Guidelines except for the following departures:
- Line losses costs are allocated to the line business on the basis that the losses occur
through the transportation of electricity over the line operator’s network. The line
business compensates the energy business with the value of those losses which are
costed at the wholesale price of electricity. The line operator recovers the cost of line
losses through the customer network charge. - Marketing costs are shared between the line business and the energy business. For this
financial year, 39% of marketing costs were allocated to the line business. The allocation
is made on the basis of benefits derived from expenditure on marketing related activities. - Inventory is allocated 100% to the line business. The allocation is made at this level to
reflect the fact that what is held in the stores are spares for the reticulation system.
(ii) RECOGNITION OF REVENUE
Energy Retailing revenue represents customer usage during the financial period. An
allowance has been included in the sales figure for unread meters as at 31 March 1996.
(iii) DEPRECIATION
Depreciation rates for major assets are as follows:-
| Buildings | Rate | Basis |
|---|---|---|
| Plant and Equipment | 10% to 50% | Diminishing Value/ |
| Straight Line | ||
| Dams and Headworks | 1% | Straight Line |
| Office Furniture & EDP Equipment | 4% to 40% | Diminishing Value/ |
| Straight Line |
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VUW Te Waharoa —
NZ Gazette 1996, No 117
NZLII —
NZ Gazette 1996, No 117
✨ LLM interpretation of page content
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Notes to the Financial Statements for Egmont Electricity Limited
(continued from previous page)
🏭 Trade, Customs & Industry23 August 1996
Financial Statements, Accounting Policies, Revenue Recognition, Depreciation, Egmont Electricity Limited