✨ Financial Statements Continuation
18 JANUARY 2008 NEW ZEALAND GAZETTE, No. 7 207
(Notes to the Consolidated Financial Statements Continued)
| 31 March 2007 | 31 March 2006 | |
|---|---|---|
| $000 | $000 |
- PROPERTY, PLANT AND EQUIPMENT
Land (At Cost) | 111 | 87 |
Buildings (At Cost) | 1,089 | 1,034 |
Accumulated Depreciation | (107) | (77) |
| 982 | 957 |
Plant and Equipment (At Valuation/Cost)| 253 | 197 |
Accumulated Depreciation | (37) | (61) |
| 216 | 136 |
Office Equipment and EDP Equipment (At Cost) | 119 | 118 |
Accumulated Depreciation | (40) | (24) |
| 79 | 94 |
Network Assets (At Valuation/Cost)| 111,877 | 102,535 |
Accumulated Depreciation | (4,447) | (12,643) |
| 107,430 | 89,892 |
Total Property, Plant and Equipment | 108,818 | 91,166 |
Network Assets and Plant and Equipment
The network assets and associated plant and equipment were revalued to $106,522,000 as at 1 April 2006 in accordance with FRS3 at Depreciated Replacement Cost as determined by PricewaterhouseCoopers (with technical support from Stronach Power Consulting Limited).
- INTANGIBLES
Opening Goodwill Arising on Acquisition | 15,140 | 15,140 |
Accumulated Amortisation | (3,595) | (2,838) |
| 11,545 | 12,302 |
Total Intangibles | 11,545 | 12,302 |
Goodwill has been amortised over 20 years as prescribed by FRS36 Accounting for Acquisitions Resulting in Combinations of Entities.
It is the view of the Management Committee that amortisation of goodwill as prescribed by FRS36 is inappropriate. The assets purchased have an average life of 53 years and were valued and purchased on the basis that they would continue in perpetuity.
The Governing Committee believe that amortisation of goodwill over a 20 year period results in the understatement of the operating surplus in these accounts by an amount of $757,000 (2006: $757,000).
There is considerable industry concern that the acquisition of infrastructure assets is not appropriately treated under FRS36, particularly in relation to the establishment of goodwill and the minimum amortisation requirements for goodwill.
Under the New Zealand equivalents of International Financial Reporting Standards (NZ IFRS) goodwill is not amortised. It is instead subject to an annual impairment test. OtagoNet will adopt NZ IFRS for the year ended 31 March 2008.
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Online Sources for this page:
VUW Te Waharoa —
NZ Gazette 2008, No 7
Gazette.govt.nz —
NZ Gazette 2008, No 7
✨ LLM interpretation of page content
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OtagoNet Joint Venture Financial Statements
(continued from previous page)
🏭 Trade, Customs & IndustryFinancial statements, Property, Plant and Equipment, Intangibles, Goodwill, Amortisation, Depreciation, Valuation, FRS36, NZ IFRS