New Zealand Gazette – 2006 – No. 164

Page 4760

✨ Financial Statements Notes



THE LINE COMPANY LIMITED

Lines Business Activity

Notes to the Financial Statements

For the Year Ended 31 March 2006

The distribution system is revalued to fair value based upon Optimised Deprival Value (ODV) and is revalued every three years.

Revaluation surpluses are taken directly to the revaluation reserve. Decreases in value are debited directly to the revaluation reserve to the extent that they reverse previous surpluses within the class of asset concerned and are otherwise recognised as an expense in the statement of financial performance.

Impairment

All items of property, plant and equipment are assessed for impairment at each reporting date.

Where the carrying amount is assessed to be greater than its recoverable amount, the item is written down. The writedown is recognised in the statement of financial performance.

Depreciation

All items of property, plant and equipment, other than land, are depreciated either on a straight line or diminishing value basis, at rates which will write off their cost or revalued amount less estimated residual value, over their expected useful lives.

Assets purchased post 1 April 1999 have been depreciated on a straight-line basis.

Major depreciation rates and methods:
Buildings 40-100 years Straight Line
Motor Vehicles, plant & equipment 10% to 50% Diminishing Value or Straight Line
Network plant & equipment 20 - 50 years Straight Line
Network Lines 1.9% to 10.3% Straight Line
Land Is not depreciated

c. Provisions

All provisions are recorded at the best estimate of the expenditure required to settle the obligation at balance date. Where the effect is material, the expected expenditures are discounted to their present value using pre-tax discount rates.

Staff Leave and Gratuity Payments
Provisions for employee entitlements includes accrued wages, bonuses, accrued holiday pay, long service leave, sick leave, trainee bonds and gratuities. Where settlement is greater than one year, the item(s) is discounted using the group’s weighted average cost of capital.

d. Dividends

Dividends are recognised in the financial year in which they are authorised and approved by the Board of Directors.

e. Discount

As the company has committed itself to crediting a discount to customers before the end of the financial year, and each individual’s entitlement has been conveyed to that individual, the full liability for the discount payment is recognised.

f. Inventory

Inventories are valued at the lower of cost, determined on an average cost basis, or net realisable value.



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Online Sources for this page:

VUW Te Waharoa — PDF NZ Gazette 2006, No 164


Gazette.govt.nz — PDF NZ Gazette 2006, No 164




✨ LLM interpretation of page content

💰 Notes to the Financial Statements for The Lines Company Limited (continued from previous page)

💰 Finance & Revenue
Financial Statements, Accounting Policies, Revaluation, Impairment, Depreciation, Provisions, Dividends, Discount, Inventory