✨ Financial Statements Accounting Policies
1248 NEW ZEALAND GAZETTE, No. 43 29 FEBRUARY 2008
d) Receivables
Receivables are stated at their estimated realisable value. All known losses are written off in the period in which it becomes apparent the debts are not collectable.
e) Inventories
Inventories are stated at the lower of cost (at weighted average cost price) and net realisable value.
f) Property, Plant and Equipment
All property, plant and equipment is initially recorded at cost less accumulated depreciation. The cost of purchased property, plant and equipment is the fair value of the consideration given to acquire the assets and the value of other directly attributable costs which have been incurred in bringing the assets to the location and condition necessary for their intended service.
Revaluation
The network system assets were revalued by means of a “Directors’ Revaluation” on 31 March 2007 to assessed fair value. The assessed fair value was achieved by taking the previously revalued assets at their 2004 carrying values and updating those values in terms of today’s material and labour costs. Previously these assets were recorded at cost less accumulated depreciation.
Network assets are revalued on a cyclical basis to fair value using a Depreciated Replacement Cost methodology with no asset being recognised at a valuation undertaken more than five years previously.
Revaluation increments are transferred to the Asset Revaluation Reserve.
g) Depreciation
Property, Plant and Equipment is depreciated on the basis of valuation or cost price less estimated residual value over the period of their estimated useful life.
Rates used are:
| Buildings | 2.50% – 15.00% | Straight Line/Diminishing Value |
| Office Equipment & EDP Equipment | 9.00% – 80.40% | Diminishing Value |
| Network Assets | 1.82% – 16.67% | Straight Line/Diminishing Value |
h) Impairment
Where the estimated recoverable amount of an asset is less than its carrying value, the asset is written down to its estimated recoverable amount and an impairment loss is recognised in the Statement of Financial Performance.
i) Income Tax
The income tax expense charged against the profit for the year is the estimated liability calculated at 33 cents in the dollar in respect of that profit.
j) Capital Work In Progress
Capital Work In Progress is stated at cost and is not depreciated.
k) Goods And Services Tax
These accounts have been prepared on a GST exclusive basis with the exception of accounts receivable and accounts payable which are GST inclusive.
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Online Sources for this page:
VUW Te Waharoa —
NZ Gazette 2008, No 43
Gazette.govt.nz —
NZ Gazette 2008, No 43
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Financial Statements for The Power Company Limited Line Business
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