✨ Financial Accounting Policies
3104
NEW ZEALAND GAZETTE, No. 128
17 AUGUST 2005
Valuation
The network assets were valued at 1 July 2002 to Depreciated Replacement Cost (DRC) as assessed by independent valuers Meritec Consultants Limited. This valuation is based on fair value as defined under Financial Reporting Standard 3 and is based on current construction costs. Subsequent additions are recorded at cost. Network assets are revalued on a cyclical basis with no asset being recognised at a valuation more than five years previously.
d) Depreciation
Depreciation is provided on a straight line basis on all tangible property, plant and equipment with the exception of land, easements and information system data at rates calculated to allocate the costs of the assets, less any estimated residual value, over their estimated useful lives.
The primary annual rates used are:
Buildings 1.0-1.4% Straight Line
Network Assets (excluding land) 1.4-15.0% Straight Line
Plant and Equipment 6.79% Straight Line
Office Equipment and EDP 6.6-15.0% Straight Line
e) Capital Work in Progress
Capital work in progress is stated at cost and is not depreciated.
f) Intangibles
Goodwill arising on the acquisition of a business represents the excess of the purchase consideration over the fair value of the identifiable net assets acquired. The carrying value will be reviewed annually by the Management Committee and adjusted where it is considered necessary.
Goodwill is amortised to the Statement of Financial Performance over 20 years.
g) Impairment
If the estimated recoverable amount of an asset is less than its carrying amount, the asset is written down to its estimated recoverable amount and an impairment loss is recognised in the Statement of Financial Performance.
h) Taxation
All amounts in the financial statements are shown exclusive of Goods and Services Tax, with the exception of receivables and payables which are shown inclusive. The Income Tax liability is the responsibility of the Joint Venture parties and therefore is not reflected in the financial statements of the Joint Venture.
i) Operating Leases
Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased items are classified as operating leases. Payments under these leases are recognised as expenses in the periods in which they are incurred.
j) Avoidable Cost Allocation Methodology
The Avoidable Cost Allocation Methodology is able to be used to separate ‘other’ activities from the Lines Business. Other activities or non Lines Business activity has been excluded from these accounts.
Changes in Accounting Policies
There have been no changes in Accounting Policies. These have been applied on a consistent basis throughout the period.
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Online Sources for this page:
VUW Te Waharoa —
NZ Gazette 2005, No 128
Gazette.govt.nz —
NZ Gazette 2005, No 128
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