✨ Financial Accounting Policies
3 SEPTEMBER NEW ZEALAND GAZETTE 3467
j) Contributions for Subdivisions/Uneconomic Lines
Contributions received from customers and grants towards the costs of reticulating new subdivisions and contributions received in constructing uneconomic lines are recognised as revenue. Any identified impairment losses in respect of uneconomic lines are recognised in the Statement of Financial Performance and the asset component is written down to its fair value.
k) Employee Entitlements
Liabilities for amounts expected to be paid to employees for their entitlement to annual leave and other current employee entitlements are measured as the amount unpaid at the reporting date at current pay rates in respect of employees' services up to that date.
A liability for long service leave is accrued for the value of expected future payments to be made in respect of services already provided by employees up to the balance date. The value is determined based on current wage and salary levels and service to date.
A liability for gratuities is accrued for the employees value of current entitlements. The value is calculated based on the age of the employee, wage and salary levels and current length of service.
l) Leases
Operating lease payments, where the lessors effectively retain substantially all the risks and benefits of ownership of the leased items, are included in the determination of operating surplus before taxation in equal instalments over the lease term.
m) Finance Leases
Leases under which the company assumes substantially all the risks and rewards of ownership are classified as finance leases and are capitalised. The finance charge is allocated to periods during the lease term.
n) Financial Instruments
The company has various financial instruments with off-balance sheet risk for the primary purpose of reducing its exposure to fluctuations in interest rates. While these financial instruments are subject to risk that market rates may change subsequent to acquisition, such changes would generally be offset by opposite effects on the items being hedged.
For interest rate swap agreements entered into in connection with the management of interest rate exposure, the differential to be paid or received is accrued as interest rates change and is recognised as a component of interest income/expense over the life of the agreement.
o) Goodwill
The excess of cost over the fair value of the net assets acquired is recognised as goodwill, and is amortised to the Statement of Financial Performance over the expected period of the benefit, currently estimated to be up to 5 years.
p) Changes in Accounting Policies
There have been no changes to accounting policies. All policies have been applied on a basis consistent with prior years.
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Online Sources for this page:
VUW Te Waharoa —
NZ Gazette 2002, No 130
Gazette.govt.nz —
NZ Gazette 2002, No 130
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Powerco Limited Gas Information Disclosure
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🏭 Trade, Customs & IndustryGas, Financial Statement, Accounting Policies, Amalgamation, Consolidation, Powerco Limited, Subdivisions, Uneconomic Lines, Employee Entitlements, Leases, Finance Leases, Financial Instruments, Goodwill