✨ Financial Accounting Notes
Deferred taxation, using the liability method, is accounted for on the comprehensive basis.
Future tax benefits attributable to tax losses or timing differences are recognised only when there is virtual certainty of realisation. The major timing differences relate to depreciation.
(b) Fixed Assets
Fixed Assets Other Than Distribution Network System Assets
All fixed assets are initially recorded at cost.
Distribution Network System Assets
The Distribution Network System Assets have been revalued to their ODV valuation of $527,406,000 as at 31 March 1997.
This valuation method allows for assets to be restated at their replacement cost less an appropriate provision for depreciation. Comparison is then made between their depreciated value and their economic value.
Should this result in a lower figure then the economic value is substituted.
Power New Zealand Limited engaged independent consultants, Coopers and Lybrand, to undertake the ODV valuation which appears in the Statement of Financial Position and notes thereto.
(c) Depreciation
Depreciation of fixed assets, other than freehold land, has been charged at rates calculated to allocate on a straight-line basis either the cost of the asset, or the valuation, less estimated residual value, over their estimated useful lives as follows:
(i) Freehold Buildings 1 - 2%
(ii) Reticulation System 1.4% - 10%
(iii) Plant, Vehicles and Equipment 10% - 50%
(d) Accounts Receivable.
Accounts Receivable are stated at their estimated net realisable value.
Receivables include an assessment for unbilled sales of electricity at balance date.
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VUW Te Waharoa —
NZ Gazette 1997, No 118
NZLII —
NZ Gazette 1997, No 118
✨ LLM interpretation of page content
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Notes to and Forming Part of the Financial Statements
(continued from previous page)
💰 Finance & RevenueFinancial Statements, Accounting Policies, Deferred Taxation, Fixed Assets, Depreciation, Accounts Receivable