✨ Financial Statements Notes
TOP ENERGY LIMITED-LINE BUSINESS
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2007
20 INTERNATIONAL FINANCIAL REPORTING STANDARDS (continued)
Financial Instruments
Any movements of the fair value of the interest rate swaps and forward exchange contracts from year to year will have the potential to affect the statement of financial performance and the statement of financial position, the extent to which will depend on whether hedge accounting is adopted. The financial impact of the change cannot be reliably estimated at this stage.
Deferred Taxation
The IFRS basis of accounting for deferred tax is conceptually different to current GAAP. Under current GAAP deferred taxation is calculated using the income statement approach whereas under NZ IFRS deferred taxation will be based on a balance sheet approach. This method recognises deferred tax balances where there is a difference between the carrying value of an asset or liability and its tax base. The most significant impact for the Company is the potential recognition of a deferred tax liability in relation to the revaluation of distribution assets.
Employee Benefits
The basis of accounting for certain elements of employee remuneration is different under NZ GAAP and NZ IFRS. Eligibility for retirement gratuity payments are currently recognised under NZ GAAP only when they vest, but under NZ IFRS the employer’s liability will be recognized on an actuarial basis. The Company expects that the current level of provisions for retirement gratuity payments and other compensated absences will increase as a result of adopting the NZ IFRS basis of accounting.
Deemed historic cost adjustment to Fixed Assets
The carrying values of previously revalued items of land, buildings and the distribution network, all of which were most recently revalued as at 31 March 2004, will be deemed as the historic cost on first time adoption of NZ IFRS and will not be revalued going forward.
Transfers between Reserves
NZ IFRS requires all items of income and expense recognised in a period to be included in profit or loss unless specifically required to the contrary. Accordingly, the various reserves shown within equity at 31 March 2007 under NZ GAAP will be transferred to retained earnings when these accounts are restated under NZ IFRS.
This summary should not be taken as an exhaustive list of all the differences between NZ GAAP and NZ IFRS. Further, the Company has not yet quantified the effects of these differences. Accordingly there can be no assurances that the financial performance and financial position as disclosed in these financial statements would not be significantly different if determined in accordance with NZ IFRS.
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Online Sources for this page:
VUW Te Waharoa —
NZ Gazette 2008, No 50
Gazette.govt.nz —
NZ Gazette 2008, No 50
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Notes to Financial Statements of Top Energy Limited
(continued from previous page)
🏭 Trade, Customs & IndustryFinancial statements, Segment information, Capital expenditure, Contingent liabilities, Events after balance date, International Financial Reporting Standards, NZ IFRS