New Zealand Gazette – 1999 – No. 128

Page 3079

✨ Financial Statements and Accounting Policies



20 SEPTEMBER NEW ZEALAND GAZETTE 3079

MAINPOWER NEW ZEALAND LTD

Notes to and Forming Part of the Financial Statements

For The Year Ended 31 March 1999

Statement of Accounting Policies Specific to MainPower’s Lines Business Activities.

Reporting Entity

The financial statements for the year ended 31 March 1999 have been prepared in accordance with the Electricity (Information Disclosure) Regulations 1999.

The group consists of MainPower, its subsidiary and its associate.

Measurement Base

The accounting principles recognised as appropriate for the measurement and reporting of earnings and financial position on a modified historic cost basis are followed by the group, with the exception that certain fixed assets have been revalued.

Accounting Policies

The following particular accounting policies which materially affect the measurement of financial performance and the financial position have been applied:

1.1 Fixed Assets

MainPower has five classes of fixed assets:

  • Distribution system
  • Land and Buildings
  • Motor Vehicles
  • Plant and Equipment
  • Furniture and Equipment

1.1a All fixed assets are initially recorded at cost.

Distribution assets are revalued by PricewaterhouseCoopers at 31 March to Optimised Deprival Valuation (ODV) levels on an annual basis.

Land and buildings are revalued annually. Valuations are at net current value as determined by Williams & Associates Ltd, an independent valuer.

1.2 Depreciation

Depreciation is provided on all tangible fixed assets other than freehold land at rates calculated to allocate the assets’ cost or valuation less estimated residual value, over their estimated useful lives. Depreciation on Distribution assets is calculated having regard to each asset’s Optimised Deprival Valuation while freehold buildings are depreciated on a straight line basis. All other assets are depreciated on a diminishing value basis.

Major depreciation rates are:

  • Freehold buildings - 1% to 2.5%
  • Motor Vehicles - 20% to 26%
  • Plant and equipment - 7.5% to 50%
  • Office furniture and equipment - 10% to 33%
  • Distribution System - 5% to 14.40%

Gains and losses on disposal of fixed assets are taken into account in determining the operating result for the year.

1.3 Income Tax

The taxation expense charged against the surplus for the year is the estimated liability in respect of that surplus and is calculated after allowance for permanent differences and timing differences not expected to reverse in future periods. This is the partial basis for the calculation of deferred taxation.

MainPower follows the liability method of accounting for deferred taxation. Future taxation benefits attributable to losses carried forward or timing differences are recognised in the financial statements only where there is virtual certainty of realisation.



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🏭 Notes to and Forming Part of the Financial Statements for MainPower New Zealand Ltd (continued from previous page)

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Financial Statements, Accounting Policies, Fixed Assets, Depreciation, Income Tax, MainPower New Zealand Ltd