New Zealand Gazette – 2007 – No. 132

Page 3414

✨ Financial Statements Notes



VECTOR LIMITED & SUBSIDIARIES

GAS DISTRIBUTION ACTIVITIES

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2007

  1. OPERATING SURPLUS BEFORE INTEREST AND INCOME TAX
NOTE 2007 2006
$'000 $'000

Operating surplus before interest and income tax includes:

  • Bad debts written off | 4 | - |
  • Increase in provision for doubtful debts | 110 | 28 |
  • Rental and operating lease costs | 573 | 735 |
  • Donations | - | 2 |
  • Directors' fees | 73 | 73 |
  • Audit fees | 91 | 81 |
  • Depreciation | 11,984 | 10,418 |
  • Amortisation of goodwill | 8 | 16,225 | 16,296 |
  1. INCOME TAX EXPENSE
2007 2006
$'000 $'000

Operating deficit before income tax | (12,828) | (12,418) |
Prima facie tax at 33% | (4,233) | (4,098) |

Plus tax effect of permanent differences:

  • Adjustment to deferred tax for change in company tax rate | (5,751) | - |
  • Other permanent differences | 5,441 | 4,889 |

Income tax (benefit) / expense | (4,543) | 791 |

The income tax (benefit) / expense is represented by:

| Current tax | (4,882) | (4,157) |
| Deferred tax | 339 | 4,948 |
| Total | (4,543) | 791 |

In May 2007, the Government changed the corporate tax rate to 30% effective from the 2008/2009 income year. In accordance with SSAP 12, the deferred tax liability has been restated, reflecting the change in corporate tax rate from 1 July 2008. As a result of the deferred tax restatement there is a reduction in the deferred tax liability of $5.7 million and a corresponding credit to income tax expense in the statement of financial performance.

  1. DEFERRED TAX
2007 2006
$'000 $'000

Balance at beginning of the year | 64,678 | 50,100 |
Prior period adjustment | - | (38) |
On acquisition of NGC gas distribution business | - | (2,048) |
Decrease relating to change in company tax rate | (5,751) | - |
Increase on revaluation of assets | - | 11,716 |
On net surplus for the year | 6,090 | 4,948 |
Balance at end of the year | 65,017 | 64,678 |

The decrease in the gas distribution business's deferred tax liability of $5.7 million resulting from the change in the corporate tax rate to 30% effective from the 2008/2009 income year is explained in Note 2 above.



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Online Sources for this page:

VUW Te Waharoa — PDF NZ Gazette 2007, No 132


Gazette.govt.nz — PDF NZ Gazette 2007, No 132




✨ LLM interpretation of page content

🏭 Notes to the Financial Statements for Gas Distribution Activities (continued from previous page)

🏭 Trade, Customs & Industry
Financial statements, Operating surplus, Income tax, Deferred tax, Gas distribution