✨ Financial Statements Notes
9 AUGUST
NEW ZEALAND GAZETTE
2207
Wairarapa Electricity Limited and Subsidiary Companies
Notes to the Financial Statements
(v) Distribution System Maintenance
A maintenance programme sufficient to maintain the distribution system indefinitely is undertaken on a continuous basis. All maintenance expenditure is charged to the Consolidated Statement of Financial Performance as incurred in accordance with the maintenance programme. Maintenance expenditure includes all expenditure items which restore the distribution system to its original condition without enhancing the system's operational capacity. Provision is made for deferred maintenance where applicable.
(vi) Electricity Sales
All amounts actually billed to customers net of prompt payment discount during the year are included as electricity sales. Provision is made and included in electricity sales for the estimated value of electricity used but not billed at year end.
(viii) Income Tax
The income tax expenses charged to the Consolidated Statement of Financial Performance includes both current and deferred tax and is calculated after allowing for non - assessable income and non - deductible costs.
Deferred taxation, calculated using the comprehensive basis under the liability method, is accounted for in respect of those timing differences expected to reverse in the foreseeable future. A future tax benefit is recognised only if there is virtual certainty of realisation.
(ix) Financial Instruments
Revenue and expenses from financial instruments are recognised using accrual accounting.
(x) Construction Contracts
Construction contracts are stated at cost plus attributable profit to date less progress billings. Cost includes all costs directly related to specific contracts and an allocation of general overhead expenses incurred by the group's contract operations. Profit is based on percentage of completion of each contract and is not recognised unless the outcome of the contract can be reliably estimated. Losses are taken to the Consolidated Statement of Financial Performance in the period in which they are identified.
(xi) Allocations to Business Units
Costs, revenues, assets and liabilities relating to the provision of contracting services to external parties have been allocated to 'Energy and Other Business'.
Except where noted below, all costs, revenues, assets and liabilities have been allocated to business units in accordance with the Ministry of Commerce Electricity Disclosure Guidelines dated 23 June 1994.
Corporate costs including directors' fees and audit fees have been allocated on the basis of estimated time spent by management on each business unit.
Trans Power transmission charges are a cost to the lines business.
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VUW Te Waharoa —
NZ Gazette 1996, No 83
NZLII —
NZ Gazette 1996, No 83
✨ LLM interpretation of page content
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Wairarapa Electricity Limited Financial Statements
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