✨ Financial Statements Notes
NEW ZEALAND GAZETTE
8 SEPTEMBER
TOP ENERGY LIMITED
NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS
STATEMENT OF ACCOUNTING POLICIES
FOR THE 12 MONTHS ENDED 31 MARCH 1997
7 Renewal Accounting - Distribution Network
Assets comprising the distribution network system are reported using the renewal accounting method and are stated at valuation. These infrastructural assets include all items directly involved in the delivery of electricity, but exclude substation land, buildings, transformers, circuit breakers and load management control equipment. All expenditure which extends or enhances the infrastructure is capitalised. Expenditure incurred in maintaining the infrastructure's capacity is treated as an expense in the period in which it is incurred. The actual amount expended is compared with a predetermined benchmark level and any shortfall or excess is adjusted through the Statement of Financial Performance. Similarly the value of the infrastructure asset is increased or decreased by the same amount.
8 Depreciation
Land, infrastructure distribution system and work-in-progress assets are not depreciated. As noted below, other fixed assets are depreciated on a straight line (Cost) or diminishing value (DV) basis that has regard to their historical cost, estimated useful life and expected residual value:
| Non-infrastructure Distribution Assets | Rate | Method |
|---|---|---|
| Buildings | 2.50% | SL |
| Plant, Equipment and Furniture | 2.00% | SL |
| Plant and Equipment - Electronic | 10.00% | SL |
| Chainsaws | 10.00-20.00% | SL |
| Computer Software | 33.33% | SL |
| Motor Vehicles | 20.00% | DV |
9 Long Term Debt
A debt restructuring provision, created by the Bay of Islands Electric Power Board to recognise that its long term debt rates were materially higher than market rates prevailing at the time of vesting, was vested in the Company on 1 May 1993.
10 Financial Instruments
All financial instruments are recognised in the Statement of Financial Position except for off balance sheet instruments such as guarantees.
Financial instruments including cash, bank, accounts receivable, accounts payable, and term debt are generally carried at their estimated fair value.
Top Energy Ltd has entered into various financial instruments with off-balance sheet risk for the primary purpose of reducing its exposure to fluctuations in foreign currency exchange rates, interest rates, and electricity spot market prices. While these financial instruments are subject to risk that market rates may change subsequent to acquisition, such changes would generally be offset by opposite effects on the items being hedged.
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VUW Te Waharoa —
NZ Gazette 1997, No 119
NZLII —
NZ Gazette 1997, No 119
✨ LLM interpretation of page content
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Notes to the Special Purpose Financial Statements
(continued from previous page)
🏭 Trade, Customs & Industry8 September 1997
Financial Statements, Accounting Policies, Depreciation, Renewal Accounting, Long Term Debt, Financial Instruments, Top Energy Limited