✨ Financial Statements Notes
VECTOR LIMITED & SUBSIDIARIES
GAS DISTRIBUTION ACTIVITIES
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2007
7. PROPERTY, PLANT AND EQUIPMENT (CONTINUED)
The fair value of land and buildings is considered equal to or in excess of their net book value.
As stated in the statement of accounting policies, interest and other costs are capitalised to property, plant and equipment while under construction. During the year $0.2 million (2006: $0.3 million) of interest and other costs were capitalised.
The Auckland system fixed assets were revalued to $276.5 million as at 31 March 2006 consistent with the group's accounting policy to revalue property, plant and equipment at least every three years. The basis of this valuation is the lesser of depreciated replacement cost and the estimated amount from the future use of these distribution assets. This valuation was undertaken in conjunction with the following parties:
| FIRM | QUALIFICATION |
|---|---|
| Eric Lucas | PricewaterhouseCoopers - CA; BA (Hons) |
| Lynne Taylor | PricewaterhouseCoopers - BSc;Soc.Sci (Hons) Economics |
| Trevor Walker | Telfer Young Ltd - Dip Val; ANZIV; SNZPI; Registered Valuer |
| Jeffrey Wilson | Wilson Cook & Co Ltd - ME; BCom; CEng; FIEE; FIPENZ; MIEEE |
8. GOODWILL
| 2007 | 2006 | |
|---|---|---|
| Balance at beginning of the year | $000 | $000 |
| 204,157 | ||
| Arising on acquisition of NGC gas distribution business | 277,617 | 58,014 |
| Prior period adjustment | - | 31,742 |
| Amortisation in the financial year | (16,225) | (16,296) |
| Balance at end of the year | 261,392 | 277,617 |
Goodwill is amortised over a period up to 20 years. Goodwill arising on acquisition of the gas distribution businesses of NGC Holdings Limited and United Networks Limited has been allocated on the basis of acquired property, plant and equipment. The prior period adjustment is in respect of the amendment to the goodwill allocation methodology.
9. ACQUISITION OF SUBSIDIARY
On 14 December 2004 Vector Limited acquired a controlling 66.05% interest in NGC Holdings Limited, a company providing utility services (including gas distribution) in New Zealand. On 10 August 2005, Vector Limited acquired the remaining shares in NGC Holdings Limited it did not already own. In compliance with the provisions of the Gas (Information Disclosure) Regulations 1997, the accounts have been prepared on the basis that the initial acquisition of NGC Holdings Limited's gas distribution activities occurred at the beginning of the 2004/2005 financial year (1 July 2004) and the subsequent acquisition at beginning of the 2005/2006 financial year (1 July 2005). Goodwill arising on acquisition of the gas distribution business of NGC Holdings Limited has been allocated on the basis of acquired property, plant and equipment as at acquisition date.
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Online Sources for this page:
VUW Te Waharoa —
NZ Gazette 2007, No 132
Gazette.govt.nz —
NZ Gazette 2007, No 132
✨ LLM interpretation of page content
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Notes to the Financial Statements for Gas Distribution Activities
(continued from previous page)
🏭 Trade, Customs & IndustryFinancial statements, Notional reserves, Asset revaluation, Receivables, Property, Plant and equipment, Goodwill, Acquisition, Subsidiary
- Eric Lucas, Valuer for asset revaluation
- Lynne Taylor, Valuer for asset revaluation
- Trevor Walker, Valuer for asset revaluation
- Jeffrey Wilson, Valuer for asset revaluation