✨ Financial Accounting Policies
Current and deferred tax is recognised as an expense or income in the Income Statement, except when it relates to items credited or debited directly to equity, in which case the deferred tax or current tax is also recognised directly in equity, or where it arises from the initial accounting for a business combination, in which case it is taken into account in the determination of goodwill or excess.
o) 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 (a) 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 hedged risk only. The Division policy is to hedge the interest/foreign currency risk associated with term debt with financial instruments on matched terms.
Borrowings are classified as current liabilities (either advances and deposits or current portion of term debt) unless the Division has an unconditional right to defer settlement of the liability for at least 12 months after the Balance Sheet date.
p) Trade and other payables
Trade payables and other accounts payable are recognised when the Division becomes obliged to make future payments resulting from the purchase of goods and services. Subsequent to initial recognition, trade payables and other accounts payable are recorded at amortised cost. Given the nature of these liabilities amortised cost equals their notional principal.
q) Inter-division account
The inter-division account represents the balance due to other Divisions within Powerco Limited. The balance is the result of inter-divisional transactions since the Division was established.
Changes in accounting policies
There have been no changes in accounting policies during the year.
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NZ Gazette 2009, No 179
✨ LLM interpretation of page content
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Director's Certificate for Gas Information Disclosure
(continued from previous page)
🏭 Trade, Customs & Industry4 December 2009
Financial Statements, Impairment Testing, Goodwill, Intangible Assets, Amortisation, Leases, Property Plant and Equipment, Depreciation, Revenue Recognition, Contributed Capital, Taxation