✨ Financial Accounting Policies
12 DECEMBER 2006 NEW ZEALAND GAZETTE, No. 169 4885
taxation in equal instalments over the lease term, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
q) Revenue Recognition
Revenue is recognised at the fair value of sales of goods and services, net of GST, rebates, discounts and capital contributions.
Revenue is recognised as follows:
(a) Rendering of Services
Revenue from services is recognised in the accounting period in which the services are rendered based upon usage or volume throughput during that period.
r) Taxation
The amount recognised for current tax is based on the net profit for the period as adjusted for non-assessable and non-deductible items. It is calculated using tax rates that have been enacted or substantively enacted by the reporting date.
Deferred income tax is provided, using the comprehensive balance sheet liability method, on all temporary differences at the balance sheet date between the tax base of the assets and liabilities and their carrying amounts in the consolidated financial statements.
The following temporary differences are not provided for: goodwill, the initial recognition of assets or liabilities that affect neither accounting nor taxable profit, and the temporary differences relating to investments in subsidiaries, where the consolidated entity is able to control the reversal of the temporary differences and it is probable that the temporary differences will not reverse in the foreseeable future.
The carrying amount of deferred income tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax to be utilised.
Deferred income tax assets and liabilities are measured at tax rates that are expected to apply to the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at balance sheet date.
The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow the manner in which the consolidated entity expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities.
Deferred tax assets and liabilities are offset when they relate to income taxes levied by the same taxation authority and the company/consolidated entity intends to settle its current tax assets and liabilities on a net basis.
Current and deferred tax is recognised as an expense or income in the income statement, except when it relates to items credited or debited directly to equity, in which case the deferred tax or current tax is also recognised directly in equity, or where it arises from the initial accounting for a business combination, in which case it is taken into account in the determination of goodwill or excess.
Income tax relating to items recognised directly in equity is recognised in equity and not in the income statement.
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Online Sources for this page:
VUW Te Waharoa —
NZ Gazette 2006, No 169
Gazette.govt.nz —
NZ Gazette 2006, No 169
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Audit Report for Powerco Limited – Electricity Division
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🏭 Trade, Customs & Industry6 December 2006
Audit, Financial Statements, Commerce Commission, Powerco Limited, Electricity, Disclosure Requirements, NZ IFRS, GAAP