✨ Financial Statements Accounting Policies
92
NEW ZEALAND GAZETTE, No. 4
14 JANUARY 2005
f) Property, Plant and Equipment
All property, plant and equipment is initially recorded at cost less accumulated depreciation. The cost of purchased property, plant and equipment is the fair value of the consideration given to acquire the assets and the value of other directly attributable costs which have been incurred in bringing the assets to the location and condition necessary for their intended service.
Revaluation
The EIL network assets were revalued as at 31 March 2004 to Depreciated Replacement Cost (DRC) as assessed by independent valuers PricewaterhouseCoopers. Previously these assets were recorded at cost less accumulated depreciation.
Network assets are revalued on a cyclical basis with no asset being recognised at a valuation undertaken more than five years previously.
Revaluation increments are transferred to the Asset Revaluation Reserve.
g) Depreciation
Property, plant and equipment is depreciated on the basis of valuation cost price less estimated residual value over the period of their estimated useful life.
The Economic life ranges for the various classes of assets are:
Buildings 1.0%-10.0% Straight line/diminishing value
Plant and Equipment 5.0%-39.6% Straight line/diminishing value
Motor Vehicles 18.0%-31.2% Diminishing value
Office Furniture & EDP Equipment 5.0%-60.0% Straight line/diminishing value
Shared Assets 9.0%-48.0% Diminishing value
Network Assets 1.4%-15.0% Straight line
h) 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.
i) Income Tax
The income tax expense charged against the profit for the year is the estimated liability calculated at 33 cents in the dollar in respect of that profit.
j) Goods and Services Tax
All amounts in the financial statements have been shown exclusive of goods and services tax, with the exception of accounts receivable and accounts payable, which are shown inclusive of goods and services tax.
k) Work in Progress
The cost of work in progress includes the cost of direct material and direct labour used in putting replacement and new systems in their present location and condition.
l) Financial Instruments
The Line Business is party to financial instrument arrangements as part of its everyday operations. Revenues and expenses in relation to all financial instruments are recognised in the Statement of Financial Performance on an accrual basis.
The Line Business has no off-balance sheet exposures. The Line Business values all financial instruments at fair value in the Statement of Financial Position.
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Online Sources for this page:
VUW Te Waharoa —
NZ Gazette 2005, No 4
Gazette.govt.nz —
NZ Gazette 2005, No 4
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Electricity Invercargill Limited Line Business Accounting Policies
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🏭 Trade, Customs & IndustryAccounting Policies, Property, Depreciation, Revaluation, Impairment, Income Tax, GST, Financial Instruments, Electricity Invercargill Limited