✨ Financial Statements Accounting Policies
1978 NEW ZEALAND GAZETTE No. 82
(e) Depreciation
Depreciation has been provided on fixed assets using the straight line method at rates which amortise the cost or valuation less estimated residual value over their economic lives.
The main bases are periods not exceeding:
Electricity distribution system 70 years
Buildings 50 years
Cars and vans 5 years
Trucks 7 years
Plant and equipment 10 years
Computer equipment and software 3 years
The electricity distribution system economic lives have been set consistent with the Ministry of Economic Development's revised ODV Handbook. The economic lives range from 15 - 70 years for the different components of the distribution system.
(f) Fixed assets
The group's fixed assets are revalued on a cyclic basis at least once every three years by independent valuers to net current value. Any subsequent fixed asset additions are initially recorded at cost until the next revaluation.
(g) Income tax
The income tax expense charged to the statement of financial performance includes both the current year's provision and the income tax effect of timing differences calculated using the liability method.
Tax effect accounting is applied on a comprehensive basis to all timing differences. A debit balance in the deferred tax account, arising from timing differences or income tax benefits from income tax losses, is only recognised if there is virtual certainty of realisation.
(h) Employee entitlements
Provision is made in respect of the Company's liability for annual and long service leave. The annual leave liability has been calculated on an actual entitlement basis at current rates of pay. The long service leave liability has been assessed on an actuarial basis.
Changes in Accounting Policies
Taxation
During the 2001 year the company changed its method of accounting for deferred tax from the partial basis to the comprehensive basis (liability method) and now accounts for deferred tax on all timing differences. The implementation of this change has resulted in the following impact on the financial statements for the current year: surplus after tax has decreased by $3,166,000 and shareholders' equity has decreased by $29,829,000.
There have been no other changes in accounting policies.
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Online Sources for this page:
VUW Te Waharoa —
NZ Gazette 2001, No 82
Gazette.govt.nz —
NZ Gazette 2001, No 82
✨ LLM interpretation of page content
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Notes to the Financial Statements for Orion New Zealand Limited
(continued from previous page)
🏭 Trade, Customs & Industry6 August 2001
Financial Statements, Accounting Policies, Depreciation, Fixed Assets, Income Tax, Employee Entitlements, Deferred Tax