✨ Financial Statements
VECTOR Limited
Electricity Lines Business
Notes to the Financial Statements
For the year ended 31 March 2001
STATEMENT OF ACCOUNTING POLICIES (continued)
j) Employee Entitlements
Employee entitlements to salaries and wages, annual leave, long-term leave and other benefits are recognised when they accrue to employees.
The liability for employee entitlements is carried at the present value of the estimated future cash outflows.
k) Statement of Cash Flows
The following are the definitions of the terms used in the Statement of Cash Flows.
Operating activities include all transactions and other events that are not investing or financing activities.
Investing activities are those activities relating to the acquisition, holding and disposal of property, plant and equipment and investments that can include securities not falling within the definition of cash.
Financing activities are those that result in changes in the size and composition of the capital structure. This includes both equity and debt not falling within the definition of cash. Dividends paid in relation to the capital structure are included in financing activities.
Cash is considered to be cash on hand and current accounts in banks, net of bank overdrafts.
l) Financial Instruments
The VECTOR group, of which the line business is the predominant activity, is party to financial instruments with off-balance sheet risk to meet financing needs and to reduce exposure to fluctuations in foreign currency exchange rates. These financial instruments include foreign exchange forward contracts, forward rate agreements and swaps.
The VECTOR group, of which the line business is the predominant activity, enters into foreign currency forward exchange contracts to hedge foreign currency transactions. A loss or gain on the item being hedged generally offsets any exposure to gains or losses on these forward contracts. Gains and losses on contracts which hedge specific short-term foreign currency denominated commitments are recognised as a short-term component of the related transaction in the period in which the transaction is completed. The VECTOR group, of which the line business is the predominant activity, is not involved in foreign exchange speculation.
The net differential paid or received on interest swaps is recognised as a component of the interest expense over the period of the agreement.
Changes in Accounting Policies
There has been no change in accounting policies and all policies have been applied consistent with those used in the prior year.
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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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