✨ Financial Accounting Policies
558 NEW ZEALAND GAZETTE, No. 25 15 FEBRUARY 2008
(e) Depreciation
Depreciation is provided on property, plant and equipment using the straight line method at rates which amortise the cost or valuation less estimated residual value over their useful lives.
The main bases are periods not exceeding:
| Electricity distribution system | 60 years |
| Building structures | 70 years |
| Building services | 30 years |
| Building fitout | 15 years |
| Cars and vans | 5 years |
| Trucks | 7 years |
| Plant and equipment | 10 years |
| Computer equipment and software | 3 years |
The depreciation methods and useful lives of property, plant and equipment are reviewed annually to ensure that they remain appropriate.
(f) Property, plant and equipment
The company’s property, plant and equipment is revalued on a cyclic basis at least once every three years by independent valuers to fair value. Any subsequent additions are initially recorded at cost until the next revaluation.
(g) Income tax
The income tax expense charged to the statement of financial performance includes both the current year’s provision and the income tax effect of timing differences calculated using the liability method.
Tax effect accounting is applied on a comprehensive basis to all timing differences. A debit balance in the deferred tax account, arising from timing differences or income tax benefits from income tax losses, is only recognised if there is virtual certainty of realisation.
(h) Employees entitlements
Provision is made in respect of the company’s liability for annual and long service leave. The annual leave liability has been calculated on an actual entitlement basis at current rates of pay. The long service leave liability has been assessed on an actuarial basis.
(i) Derivative financial instruments
The company may enter into swaps, forward rate agreements and options transactions. Such transactions are undertaken within board approved policies and limits for the primary purpose of reducing exposure to fluctuations in interest rates and foreign exchange rates. While these financial instruments are subject to the risk that market rates may change subsequent to the acquisition of the financial instrument, such changes would generally be offset by opposite effects on the items being hedged. For the agreements, the differential to be paid or received is accrued as rates change and is recognised over the life of the agreements.
The company does not engage in speculative transactions or hold derivative financial instruments for trading purposes.
Changes in accounting policies
There have been no changes in accounting policies in the 2007 year. The company’s accounting policies have been applied on bases consistent with those used in previous years.
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Online Sources for this page:
VUW Te Waharoa —
NZ Gazette 2008, No 25
Gazette.govt.nz —
NZ Gazette 2008, No 25
✨ LLM interpretation of page content
🏭
Statement of cash flows for Orion New Zealand Limited
(continued from previous page)
🏭 Trade, Customs & IndustryCash Flows, Operating Activities, Investing Activities, Financial Year
💰 Depreciation Policy for Property, Plant, and Equipment
💰 Finance & RevenueDepreciation, Straight Line Method, Useful Lives, Property, Plant, Equipment
💰 Revaluation of Property, Plant, and Equipment
💰 Finance & RevenueRevaluation, Fair Value, Independent Valuers, Cyclic Basis
💰 Income Tax Accounting Policy
💰 Finance & RevenueIncome Tax, Liability Method, Timing Differences, Tax Effect Accounting
💰 Employee Entitlements Provision
💰 Finance & RevenueEmployee Entitlements, Annual Leave, Long Service Leave, Actuarial Basis
💰 Derivative Financial Instruments Policy
💰 Finance & RevenueDerivative Financial Instruments, Swaps, Forward Rate Agreements, Options, Hedging
💰 Consistency in Accounting Policies
💰 Finance & RevenueAccounting Policies, Consistency, No Changes