✨ Financial Statements Notes
VECTOR Limited
Electricity Lines Business
Notes to the Financial Statements
For the year ended 31 March 2001
STATEMENT OF ACCOUNTING POLICIES (continued)
d) Accounts Receivable
Accounts receivable are carried at estimated realisable value after providing against debts where collection is doubtful.
e) Income Tax
The income tax expense recognised for the year is the accounting surplus, adjusted for permanent differences between accounting and tax rules.
The impact of all timing differences between accounting and taxable income is recognised as a deferred tax liability or asset. This is the comprehensive basis for the calculation of deferred tax liability under the liability method.
A deferred tax asset, or the effect of losses carried forward that exceed the deferred tax liability, is recognised in the financial statements only where there is the virtual certainty that the benefit of the timing differences, or losses, will be utilised.
f) Inventories
Inventories are stated at lower of cost and net realisable value. Cost is determined on a weighted average cost basis.
g) Leases
Operating lease payments, where the lessors effectively retain substantially all the risks and benefits of ownership of the leased assets, are included in the determination of the surplus in equal instalments over the lease term.
The cost of improvements to leasehold property is capitalised and amortised over the unexpired period of the lease or the estimated useful life of the improvements, whichever is the shorter.
h) Foreign Currencies
Transactions denominated in a foreign currency are converted to New Zealand dollars at the exchange rates in effect at the date of the transaction, except when forward currency contracts have been taken out to cover short-term forward currency commitments.
Short-term transactions covered by forward exchange contracts are measured and reported at the forward rates specified in those contracts.
At balance date foreign currency monetary assets and liabilities are translated to New Zealand dollars at the balance date exchange rate and exchange variations arising from these translations are included in the statement of financial performance.
The exchange differences on hedging transactions undertaken to establish the price of particular sales or purchases, together with any costs associated with the hedge transactions, are deferred and included in the measurement of the purchase or sale transaction.
i) Goods and Services Tax (GST)
The statement of financial performance and statement of cash flows have been prepared so that all components are stated exclusively of GST. All items in the statement of financial position are stated net of GST, with the exception of the receivables and payables, which include GST invoiced.
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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
✨ LLM interpretation of page content
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Vector Limited Notes to the Financial Statements
(continued from previous page)
🏭 Trade, Customs & IndustryFinancial Statements, Accounting Policies, Accounts Receivable, Income Tax, Inventories, Leases, Foreign Currencies, Goods and Services Tax, Vector Limited