✨ Financial Statement Adjustments
4926
NEW ZEALAND GAZETTE, No. 170
12 DECEMBER 2006
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.
| 30 June 2005 | Effect on Adoption | 1 July 2005 | |
|---|---|---|---|
| NZ$000 | NZ$000 | NZ$000 | |
| Equity | |||
| Issued capital | 119,080 | 119,080 | |
| Retained earnings | (1,987) | (1,987) | |
| Reserves | (31,979) | (1,920) | (33,899) |
| Total Equity | 85,114 | (1,920) | 83,194 |
| Non Current Liabilities | | | |
| Borrowings | 158,080 | (10,030) | 148,050 |
| Other financial liabilities | - | 12,896 | 12,896 |
| Deferred tax liability | 19,304 | (946) | 18,358 |
| Current account | 49,453 | | 49,453 |
| | 226,837 | 1,920 | 228,757 |
| Current Liabilities | | | |
| Borrowings | 64,233 | | 64,233 |
| Trade and other payables | 4,724 | | 4,724 |
| Tax payable | 171 | | 171 |
| | 69,128 | | 69,128 |
| Total Equity and Liabilities | 381,079 | - | 381,079 |
| Non Current Assets | | | |
| Property, plant and equipment | 378,812 | - | 378,812 |
| | 378,812 | | 378,812 |
| Current Assets | | | |
| Receivables | 2,267 | | 2,267 |
| | 2,267 | | 2,267 |
| Total Assets | 381,079 | - | 381,079 |
The $1.920 million adjustment shown above in equity represents the recognition of interest rate swaps and cross currency swaps at 30 June 2005 ($12.896m), deferred tax on interest rate swaps ($0.946m) and the adjustment to the carrying value of loans covered by fair value hedges (adjustment for the fair value of interest rate risk on loans hedges by fair value hedges $10.030 m). This adjustment has been made to the hedging reserve as the hedges were effective hedges under the superseded accounting policies.
The $12.896m adjustment above represents the fair value of hedges at 30 June 2005. This adjustment was done to record the derivatives as a separate class of liability. The $10.030m adjustment represents the fair value adjustment to hedged loans. The $0.946m relates to deferred tax on the hedges.
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Online Sources for this page:
VUW Te Waharoa —
NZ Gazette 2006, No 170
Gazette.govt.nz —
NZ Gazette 2006, No 170
✨ LLM interpretation of page content
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Statement of Accounting Policies for Powerco Limited
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🏭 Trade, Customs & IndustryAccounting Policies, Financial Statements, Revenue Recognition, Taxation, Deferred Tax, Cash Flows, Financial Instruments, Receivables, Interest Rate Swaps, Cross Currency Swaps