New Zealand Gazette – 1999 – No. 164

Page 3929

✨ Financial Statements



NEW ZEALAND GAZETTE

5 NOVEMBER

BULLER ELECTRICITY LIMITED – LINE BUSINESS

Notes to and forming part of the Financial Statements

1. STATEMENT OF ACCOUNTING POLICIES

Buller Electricity Limited is a public company registered under the Companies Act 1993. These financial statements have been prepared for the purpose of complying with the requirements of the Electricity [Information Disclosure] Regulations 1999 and are intended for no other purpose.

MEASUREMENT BASE

The accounting principles recognised as appropriate for the measurement and reporting of financial performance, financial position, movements in equity and cashflows under the historical cost method as modified by the revaluation of certain assets have been followed in the preparation of these statements.

SPECIFIC ACCOUNTING POLICIES

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

(a) Revenue

Line charges are recognised as actual amounts invoiced during the period together with an accrual for the estimated value of unread meters and unbilled line charges at balance date. Contributions received from customers towards the cost of reticulating subdivisions and constructing line extensions are recognised as revenue in the year received.

(b) Fixed Assets

The distribution system assets were revalued by PriceWaterhouseCoopers, an independent valuer to Optimised Deprival Value [ODV] basis as at April 1 1998. Subsequent additions to the distribution network are recorded at cost. Other assets associated with energy trading have been revalued by Coast Valuations Limited as at April 1 1998 and subsequent additions are recorded at cost.

Land and buildings have been revalued by Coast Valuations Limited an independent registered valuer as at March 31 1997 in accordance with the New Zealand Institute of Valuers Asset Valuation Standards at net current value.

(c) Accounts Receivable

Accounts receivable are stated at their estimated net realisable value. All known bad debts have been written off during the year.

(d) Depreciation

Depreciation is provided on a straight line basis so as to write off the cost of the fixed assets to their expected residual value over their estimated useful lives as follows:

  • Freehold Buildings: 40 – 50 years
  • Distribution System: 3 – 60 years
  • Other: 3 – 10 years

Depreciation has been charged on a monthly basis on assets acquired and which became operational during the month.

(e) Income Tax

The income tax expense charged to the statement of financial performance is the estimated liability in respect of the profit for the year and is calculated after allowance for permanent differences. The company uses the liability method of accounting for deferred taxation and applies this on a comprehensive basis. Future tax benefits attributable to tax losses or timing differences are only recognised if there is virtual certainty of realisation.

(f) Investments

Investments are stated at cost.

The accompanying notes form part of these financial statements



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Electricity, Financial Statements, Accounting Policies, Buller Electricity Limited