✨ Financial Statements Notes
4198
NEW ZEALAND GAZETTE, No. 168
17 DECEMBER 2004
(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:
Electricity distribution system 60 years
Building structures 60 years
Building services 30 years
Building fitout 15 years
Cars and vans 5 years
Trucks 7 years
Plant and equipment 10 years
Computer equipment and software 3 years
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 company'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
Due to the revaluation of the company's electricity distribution network and buildings at 31 March 2003, accounting depreciation expense has increased. Some asset lives have also been extended. The net consequence of these depreciation changes has been to reduce the company's net surplus from 2004 onwards by $3.5 million per annum.
Other than the above, the company's accounting 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 2004, No 168
Gazette.govt.nz —
NZ Gazette 2004, No 168
✨ 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 & IndustryAccounting policies, Depreciation, Property valuation, Income tax, Employee entitlements, Financial reporting