✨ Financial Accounting Policies
9 DECEMBER 2008 NEW ZEALAND GAZETTE, No. 191 5005
Financial assets at fair value through profit or loss
Other financial assets relate to outstanding derivatives at year end. All derivative assets are measured at fair value through profit or loss, except for derivatives that are designated and effective cash flow hedges. Effective cash flow hedges are measured at fair value with the movement on these assets are recorded directly in the hedging reserve in the Statement of Changes in Equity. Refer to (i) for the accounting policy on derivative financial instruments.
Loans and receivables
Cash and cash equivalents and trade and other receivables are recorded at amortised cost using the effective interest rate method, less impairment.
f) Financial liabilities
Financial liabilities are recognised when the entity became party to the contractual provisions of the instrument.
The Division derecognises financial liabilities when and only when the Division's obligations are discharged, cancelled or expire.
Financial liabilities are classified as either financial liabilities at fair value through profit or loss or other financial liabilities.
Financial liabilities at fair value through profit or loss
Other financial liabilities relate to outstanding derivatives at year end. All derivative liabilities are measured at fair value through profit or loss, except for derivatives that are designated and effective cash flow hedges. Effective cash flow hedges are measures at fair value with the movement on these liabilities are recorded directly in the hedging reserve in the Statement of Changes in Equity. Refer to (i) for the accounting policy on derivative financial instruments.
Other financial liabilities
Trade and other payables are borrowings are financial instruments that are initially measured at fair value, net of transaction costs. They are subsequently measured at amortised cost using the effective interest method, with interest expense recognised on an effective interest basis.
g) Term debt
All loans and borrowings are initially recognised at cost, being the fair value of the consideration received net of issue costs associated with the borrowing. Subsequent to initial recognition, loans and borrowings are carried at amortised cost. Borrowing costs are recognised as an expense when incurred, except to the extent that they are capitalised in accordance with (d) above.
All interest bearing loans and borrowings are measured at amortised cost using the effective interest rate method which allocates the cost through the expected life of the borrowing. Amortised cost is calculated taking account of issue costs, and any discounts or premiums on draw down.
After initial recognition for those interest-bearing loans and borrowings where fair value hedge accounting is applied, the loan balance is adjusted for the change in the hedge risk only. The Division's policy is to hedge the interest/foreign currency risk associated with term debt with financial instruments on matched terms.
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NZ Gazette 2008, No 191
✨ LLM interpretation of page content
💰 Financial Assets Accounting Policy
💰 Finance & RevenueFinancial Assets, Recognition, Derecognition, Trade Date, Fair Value, Transaction Costs, Profit and Loss
💰 Financial Liabilities Accounting Policy
💰 Finance & RevenueFinancial Liabilities, Recognition, Derecognition, Fair Value, Amortised Cost, Hedging Reserve
💰 Term Debt Accounting Policy
💰 Finance & RevenueTerm Debt, Loans, Borrowings, Amortised Cost, Fair Value Hedge, Interest Rate