✨ Financial Statements Notes
2654 NEW ZEALAND GAZETTE No. 104
2.5 NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
For the year ended 31 March 2001
These notes refer to the numbered notes to the statements in Sections 2.1 to 2.4 and are to be read in conjunction with the statements.
1 STATEMENT OF ACCOUNTING POLICIES
Special purpose financial statements
These financial statements are made pursuant to UnitedNetworks' obligations under the Electricity (Information Disclosure) Regulations 1999, read with Electricity (Information Disclosure) Amendment Regulations 2000. They are in addition to UnitedNetworks' financial statements published pursuant to UnitedNetworks' obligations under the Companies Act 1993 and the Financial Reporting Act 1993.
The Lines Business is treated as the core business and corporate activities are accounted for through the Line and Other Business financial statements. UnitedNetworks has adopted the avoidable cost allocation methodology stipulated in the Electricity Information Disclosure Handbook issued on 30th June 2000.
General accounting policies
The general accounting principles as recommended by the Institute of Chartered Accountants of New Zealand for the measurement and reporting of financial performance, financial position, movements in equity and cash flows under the historical cost method have been followed by the company with the exception of System Fixed Assets, which have been revalued to their Optimised Deprival Value (ODV) in accordance with the treatment outlined in the Electricity Information Disclosure Handbook. This is more fully explained within the particular accounting policy for Fixed Assets.
The following particular accounting policies which materially affect the measurement of the financial performance and position have been applied:
Consolidation
On 20 December 1999, the investment in Horizon Energy Distribution Limited (HEDL) was sold to the Bay of Plenty Electricity Consumers Trust. The Statement of Financial Performance, Statement of Movements in Equity, Statement of Cash Flows and the Reconciliation of Operating Surplus for the year-end 31 March 2000 contain the pro-rated results of HEDL to the date of sale.
Income tax
These financial statements adopt the liability method of accounting whereby the income tax expense shown in the statement of financial performance is the estimated total liability relating to the income for the period. Deferred taxation is accounted for in respect of items relating to the statement of financial performance, following the liability method, on the comprehensive basis. Where the revalued assets are intended to be held long term, the deferred taxation liability relating to the revaluation, arising from depreciation claimed for taxation purposes, is not expected to crystallise in the foreseeable future. Accordingly, the taxation liability, which would arise if the revalued assets were disposed of at valuation, has not been recognised.
The taxation effect of the timing difference not recognised is disclosed in note 5.
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Online Sources for this page:
VUW Te Waharoa —
NZ Gazette 2001, No 104
Gazette.govt.nz —
NZ Gazette 2001, No 104
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Notes to Financial Statements for UnitedNetworks
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