New Zealand Gazette – 2005 – No. 199

Page 5027

✨ Financial Statements Accounting Policies



30 NOVEMBER 2005 NEW ZEALAND GAZETTE, No. 199 5027

Assets constructed by NGC are commissioned and transferred from construction in progress to property, plant and equipment as each facility or operating unit within a facility becomes operational and available for use.

iii) Current Assets
Accounts receivable are valued at their estimated realisable value. Inventories are valued at the lower of cost and net realisable value. Cost is determined on a weighted average cost basis. All other current assets are valued at their estimated realisable value.

iv) Depreciation
Non current assets are depreciated on a straight line basis.

The rates of depreciation vary according to the nature and economic lives of the assets and fall within the following ranges:

  • High Pressure Pipelines 65 years
  • Compressors and Gate Stations 35 - 45 years
  • Plant, Equipment and Motor Vehicles 5 - 20 years
  • Buildings 40 - 100 years
  • Capital Spares 5 - 20 years

Depreciation of pipelines commence when the pipeline is physically complete and flowing gas.

v) Leased Assets
NGC leases certain plant, equipment, land and buildings. Under operating leases, all the risks and benefits of ownership are effectively retained by the lessor. Operating lease payments are expensed in the period in which they are incurred.

vi) Taxation
NGC recognises deferred taxation using the liability method and on a comprehensive basis. Income tax expense is recognised on the surplus before taxation. It is then adjusted for permanent differences between taxable and accounting income. The tax effect of all differences, which arise from items being brought to account in different periods for income tax and accounting purposes, is recognised in the Statement of Financial Position as a future tax benefit or as deferred tax. The future tax benefit or deferred tax is stated at the income tax rates prevailing at balance date. Future tax benefits are not recognised unless realisation of the asset is virtually certain. Future tax benefits and deferred tax are offset.

vii) Deferred Expenditure
Deferred expenditure is expenditure which provides benefits beyond the current accounting period. These expenditures include the connection of new customers to the gas transportation system and other payments for which future benefits are gained and are written off over periods up to 10 years.

e) Changes in Accounting Policies
There have been no changes in accounting policies. These policies have been applied on a consistent basis during the year.

f) Comparatives
The presentation of certain comparatives has been restated to ensure consistency with current year disclosures.



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Online Sources for this page:

VUW Te Waharoa — PDF NZ Gazette 2005, No 199


Gazette.govt.nz — PDF NZ Gazette 2005, No 199




✨ LLM interpretation of page content

🏭 Certification of NGC Gas Transmission Financial Statements (continued from previous page)

🏭 Trade, Customs & Industry
30 November 2005
Financial Statements, Audit, Gas Industry, NGC Holdings Limited, Gas (Information Disclosure) Regulations 1997