New Zealand Gazette – 2001 – No. 89

Page 2274

✨ Financial Accounting Policies



2274 NEW ZEALAND GAZETTE No. 89

Depreciation

Fixed assets have been depreciated, so as to write off cost less estimated residual value over their estimated useful lives, on the following basis:

Distribution System

  • 4% Straight Line (SL)
  • 6.7% to 10% SL for Meters
  • 4% SL for Relays
  • 22% Diminishing Value (DV) for system automation equipment

Buildings

  • 2% SL for majority of buildings
    (some at 1% SL)

Plant & Equipment

  • 40% DV for computer hardware and software
  • 20% and 25% DV for other items

Motor Vehicles

  • 20% and 25% DV for majority of vehicles

Following the revaluation of Distribution System assets at 31 March 2001, estimated useful lives of Distribution System fixed assets has been reviewed. As a consequence of this, depreciation will in future be calculated based upon estimated useful lives of between 15 and 70 years.

Taxation

The tax expense recognised for the year is based on 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 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 virtual certainty that the benefit of the timing differences, or losses, will be utilised.

Statement of Cash Flows

The following are the definitions of the terms used in the statement of cash flows:

a) Cash is considered to be cash on hand, current accounts in banks net of bank overdrafts and short term deposits with banks.

b) Investing activities are those activities relating to the acquisition, holding and disposal of fixed assets and investments. Investments can include securities not falling within the definition of cash.



Next Page →



Online Sources for this page:

VUW Te Waharoa — PDF NZ Gazette 2001, No 89


Gazette.govt.nz — PDF NZ Gazette 2001, No 89




✨ LLM interpretation of page content

💰 Depreciation Policy (continued from previous page)

💰 Finance & Revenue
Depreciation, Fixed Assets, Distribution System, Buildings, Plant & Equipment, Motor Vehicles

💰 Taxation Policy

💰 Finance & Revenue
Tax Expense, Accounting Surplus, Deferred Tax, Liability Method

💰 Statement of Cash Flows Definitions

💰 Finance & Revenue
Cash, Investing Activities, Fixed Assets, Investments