✨ Financial Statements Notes
2684
NEW ZEALAND GAZETTE
No. 105
VECTOR Limited
Electricity Lines Business
Notes to the Financial Statements
For the year ended 31 March 2001
1. STATEMENT OF ACCOUNTING POLICIES
Reporting entity
The financial statements have been extracted from the audited financial statements of the VECTOR Limited parent company and represent the electricity line business activities of the company.
VECTOR Limited is a company registered under the Companies Act 1993.
Statutory base
The financial statements have been drawn up in accordance with the requirements of the Companies Act 1993, the Financial Reporting Act 1993 and Regulation 6 of the Electricity (Information Disclosure) Regulations 1999 and Regulation 15 of the Electricity (Information Disclosure) Amendment Regulations 2000.
Measurement base
The financial statements are prepared on the basis of historical cost modified by the revaluation of certain assets as identified in specific accounting policies below.
The avoidable cost allocation methodology (ACAM) used for allocating costs and assets and liabilities between "line" and "other" activities is in accordance with the Electricity Information Disclosure Handbook 30 June 2000.
Specific accounting policies
The following specific accounting policies that materially affect the measurement of financial performance, financial position and cash flow have been applied.
a) Income Recognition
Income from the provision of line network services is recognised as services are delivered. Interest income is accounted for as earned.
b) Fixed Assets
The cost of purchased property, plant and equipment is the value of the consideration given to acquire the assets and the value of other directly attributable costs which have been incurred in bringing the assets to the location and condition necessary for the intended service.
The cost of self-constructed assets includes the cost of all materials used in construction, direct labour on the project, financing costs that are attributable to the project and an appropriate proportion of the variable and fixed overheads. Costs cease to be capitalised as soon as the asset is ready for productive use and do not include any inefficiency costs.
Fixed assets except distribution systems and some land and buildings are recorded at cost less accumulated depreciation. Distribution systems and some land and buildings are recorded at their Optimised Deprival Value (ODV) - the lower of optimised depreciated value and economic value. Revaluations are carried out at least every three years and are conducted under the guidance of independent experts. Subsequent additions are recorded at cost.
c) Depreciation
Depreciation is calculated so as to expense the cost of the assets, or the revalued amounts, to their residual values over their useful lives as follows:
Buildings 50 years
Distribution systems 15 - 70 years
Motor vehicles 20% - 33% per annum diminishing value
Consumer billing and information systems 3 - 40 years
Office equipment 3 - 40 years
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Online Sources for this page:
VUW Te Waharoa —
NZ Gazette 2001, No 105
Gazette.govt.nz —
NZ Gazette 2001, No 105
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Vector Limited Notes to the Financial Statements
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