✨ Financial Accounting Policies
NEW ZEALAND GAZETTE
No. 103
(e) Depreciation
Depreciation has been provided on property, plant and equipment using the straight line method at rates which amortise the cost or valuation less estimated residual value over their useful lives.
The main bases are periods not exceeding:
| Asset Type | Useful Life |
|---|---|
| Electricity distribution system | 55 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 useful lives range from 15 - 70 years for the different components of the distribution system. The depreciation methods and useful lives of property, plant and equipment are reviewed annually to ensure that they remain appropriate.
(f) Property, plant and equipment
The group’s property, plant and equipment is revalued on a cyclic basis at least once every three years by independent valuers to fair value. Any subsequent 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
There have been no changes in accounting policies in the 2003 year. The policies have been applied on bases consistent with those used in previous years.
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Online Sources for this page:
VUW Te Waharoa —
NZ Gazette 2003, No 103
Gazette.govt.nz —
NZ Gazette 2003, No 103
✨ LLM interpretation of page content
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Notes to the Financial Statements
(continued from previous page)
💰 Finance & RevenueAccounting Policies, Depreciation, Property Valuation, Income Tax, Employee Entitlements