✨ Financial Statements Notes
30 SEPTEMBER 2005
NEW ZEALAND GAZETTE, No. 166
4177
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) Foreign currency transactions
Transactions denominated in foreign currencies are translated at the New Zealand rate of exchange, using the average rate for the month in which the transactions occurred. At balance date foreign monetary assets and liabilities are translated at the closing rate and exchange variations arising from these transactions are included in the Statement of Financial Performance.
p) Translation of Financial Statements of Foreign Operations
Assets and liabilities of foreign operations are translated at the closing rate. Revenue and expense items are translated at a weighted average of exchange rates over the period, as a surrogate for the spot rates at transaction dates. Exchange differences arising from translation are taken to the foreign currency translation reserve and recognised in the Statement of Movements in Equity. The foreign operations are independent trading operations by wholly owned subsidiaries.
q) Goodwill
Goodwill arising on the acquisition of subsidiaries is recognised as an asset and separately disclosed. Goodwill is amortised in the statement of financial performance on a straight line basis over the period of expected benefits. To the extent that the unamortised balance of goodwill is no longer probable of being recovered from the expected future economic benefits, it is recognised immediately as an expense.
r) Goods and Services Tax (GST)
All items in the statement of financial position are stated exclusive of GST, with the exception of receivables and payables, which include GST. All items in the statement of financial performance and statement of cash flows are stated exclusive of GST.
s) Receivables
Accounts receivable are valued at expected realisable value, after providing for doubtful debts. All known bad debts have been written off during the period under review.
t) Revenue Recognition
Revenue from the sale of distribution and value-added services is recognised when services are provided.
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Online Sources for this page:
VUW Te Waharoa —
NZ Gazette 2005, No 166
Gazette.govt.nz —
NZ Gazette 2005, No 166
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